USD/JPY and AUD/USD Forecast - 1 November 2018

USD/JPY

The US dollar tried to rally against the Japanese yen during the trading session on Wednesday but gave back quite a bit of the gains. By doing so, it looks as if we are going to form a shooting star which of course is a negative turn of events. I don’t think that a major meltdown is coming but I do recognize that a pullback is probably about to happen. However, we can break above the top of the shooting star that would be a very good sign. That could send the market to the ¥114.50 level. This is a market that runs on risk appetite and tends to move right along with the S&P 500. It’s worth noting that the S&P 500 formed a shooting star, which means we may get a pullback there as well.

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AUD/USD

The Australian dollar fell during the trading session on Wednesday, as we continue to grind sideways overall. The 0.71 level above offers resistance while the 0.70 level underneath offer support. I think we should stay in this range, as there isn’t enough good news coming out of China or the Sino-American relations to propel the Australian dollar higher. The 0.70 level has been extraordinarily supportive, and I think that if we can break down below there the market could go to the 0.68 handle. With that in mind, I believe that the market breaking below that level would probably be accompanied by some type of increased tensions in the US/China relations, or perhaps a failure of anything to come out of the meeting in Argentina where the leaders are supposed to have a little bit of face-to-face time. I have no interest in buying.

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Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.