USD/JPY
The USD/JPY pair rallied on Monday, testing the 112 level. I think that there is a bit of a “zone” of resistance that extends to the 112.50 level. Because of this, I’m not willing to buy this pair until we break above there. Alternately, some type of exhaustive candle between here and there could be a selling opportunity. I’m not interested in shorting yet, because I think there is still plenty of buying pressure, and of course the NASDAQ 100 and the NASDAQ Composite both arose rather significantly. With this, it’s likely that this pair will try to break out to the upside but I’m not willing to anticipate it, I would rather let it happen first and simply follow along. If we do roll over, I think the market will probably reach towards the 109 handle.
AUD/USD
The Australian dollar rallied during the day on Monday, jumping over the 0.75 level. The market ran into a bit of trouble near the 0.7550 handle though, so it looks as if we will continue to run into trouble as we rally. Ultimately, some type of exhaustive candle will be a selling opportunity but we don’t have it yet. It’s not until we break above the 0.76 level, that I would consider buying this market. Also, I would also consider paying attention to the gold market as well. Gold markets will be very important for the Australian dollar, and they almost must rally to make the Aussie hang on to the gains for any real length of time. If we break down from here, or even roll over, I believe that the market will then go looking for the 0.74 handle. There is a lot of volatility in this pair, and I think that will continue to be the case in the short term.
