USD/JPY
The US dollar initially tried to rally during the trading session on Monday, but then rolled over again as it looks like we are trying to head down to the ¥110 level. This is an area that continues to be important, but I think even if we break down below that there will probably be buyers at the ¥109 level, and most certainly at the ¥108 level. This pair will continue to be very noisy, which makes a lot of sense considering there are a lot of questions when it comes to global trade and more specifically trade between China and the United States. The US dollar took a bit of a breather during the day against most currencies anyway, so that provided a little bit more negative pressure. I believe that the market will eventually find buyers, but right now I’m not overly interested in this market.
AUD/USD
The Australian dollar has pulled back slightly during the trading session on Monday, but then rally to. The Australian dollar formed a nice hammer during the previous week, suggesting that perhaps we working to get a bit of a relief rally. We have also seen the Gold markets rally as well, so it makes sense that we went higher. I think that the 0.7350 level above could cause a bit of resistance, and I think it’s only a matter of time before we turn back around. If we broke above the 0.7350 level, we could then go to the 0.75 handle after that. A break of that level would be very bullish indeed and could turn the entire trend around. However, I don’t think that happens anytime soon and I think that rallies will be sold.
