(MENAFN- Daily Forex) USD/JPY
The US dollar initially fell during the trading session on Monday but bounced from a major trendline that I have been following, breaking to the upside and above the ¥113 level. The 200 day exponential moving average is sitting just below, just as the ¥112 level is. At that point, I think that we are more than likely going to see buyers taken advantage of dips and what has been a strong move to the upside. The ¥114.50 level above is the beginning of a major resistance on to the ¥115 level, and if we can break above there it's likely that we continue to go much higher on a longer-term chart. If we did break down below the 200 day EMA, then I think the market probably breaks down much further, perhaps down to the ¥110 level, and then possibly even the ¥108 level.
AUD/USD
The Australian dollar initially gapped lower at the open on Monday, but then turned around to fill that gap. We ended up turning around to form a bit of a shooting star, showing signs of weakness yet again. The market looks as if it is testing the lows again, but if we break down below the previous downtrend line, then we could probably go down to the 0.70 level. Alternately, if we break above the top of the candle stick for the session on Monday, then we will probably continue to go back and forth, perhaps reaching as high as the 0.74 level. However, with tensions ratcheting up between the United States and China, it's likely that we will continue to see rallies sold off at the first signs of exhaustion. In general, I think we are certainly in a scenario that doesn't bode well for riskier currencies.
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