FX levels to watch – EUR/USD, USD/JPY, AUD/USD

With the US on holiday today and little economic data, FX markets may struggle for direction. However, the rally in USD/JPY goes on, while both the euro and the Aussie look weak against the US dollar.

US dollar and Japanese Yen
Source: Bloomberg

EUR/USD moves lower
Friday’s rally failed to push the pair beyond the 50-day simple moving average (SMA), $1.1208, with the price opening below this level this morning.

Any rally needs to clear this level to maintain momentum, but will also need to push rapidly on through the downtrend line off the April highs.

A close above $1.1250 would accomplish this. The 200-day SMA at $1.1168 is providing some support, while a drop down to Friday’s lows ($1.1104) would see the price hit the post-December 2015 trendline. 

USD/JPY attempts to push higher

Friday’s sharp move lower put the pair back below the crucial September high, but so far this morning dip buyers are returning to lift the pair off the lows at ¥101.82.

A break above the September high of ¥104.32 is crucial if the pair is to maintain its rally. Meanwhile, any further weakness could see the 50-day SMA at ¥101.72 tested, with an additional decline taking the price back to the lows of the summer, around the crucial ¥100 level. 

AUD/USD puts sellers in charge

Strength on Friday failed to carry this pair above its 50-day SMA ($0.7611), so today the sellers appear to have returned. A first target will be a move below $0.7550, Friday’s lows, and then on to the 100-day SMA at $0.7524, with the trendline off the January lows just below this.

Any rally needs to clear the 50-day SMA, and then on to $0.77 and the September highs. 

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