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For what it’s worth, German Flash Manufacturing came in a little hotter than anticipated, as its Services number came in a little lower than anticipated. It was a slightly mixed to negative picture coming out of the European Union. Later in the day, we’ll get manufacturing and services PMI coming out of the US and that could change things. But as things stand right now, this looks like the market is just simply trying to find some type of equilibrium right around the 1.14 level.
USD/JPY Technical Analysis
The US dollar spiked against the Japanese yen to break above the 143 yen level but then gave back quite a bit of those gains. Again, I think the PMI numbers in the United States could be a big mover here over the next 24 hours, but if we can break back above this 143 yen level, I’d be willing to start thinking about buying this pair because I think it would show a real chance at recovery. If we break down below the 140 yen level, then things could get rather ugly. We could drop, as low as maybe even 130 yen, possibly even 128 yen. So, the 140 yen level is very important.
AUD/USD Technical Analysis
The Australian dollar initially fell during the session, but turned around to rally and we find ourselves right at the 200 day EMA again. This obviously is a technical indicator that a lot of people pay attention to, and it has offered a bit of technical resistance over the last couple of days. The question at this point is, can we pick up enough momentum to continue going higher? That would be signified by a move above the 0.65 level.
And in the interim, I think we are just simply killing time trying to figure out where the next move is because quite frankly, we got here way too quickly. We will have to sort out, is this a short covering rally, as it looks like on longer term charts, or is there something positive going on here? It’s a little bit early to jump on the bandwagon of the Australian dollar, but we are definitely at a major inflection point.
For a look at all of today’s economic events, check out our economic calendar.
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