USD/JPY
The USD/JPY pair gapped higher at the open on Monday, grinding a bit higher. However, there is a little bit of resistance above, so it’s likely that we may have to pull back a little bit before we continue to go to the upside. I believe that given enough time we should continue to reach towards the 105 level, mainly due to the fact that the Bank of Japan is starting to lose it since the humor when it comes to the strength of the Yen in general. Ultimately, I believe that there is a massive amount of support just below, especially near the 100 level. This I believe is a bit of a “line in the sand” when it comes to the Bank of Japan, and with this being the case it’s likely that buyers will return again and again every time we dip.
AUD/USD
The Australian dollar rallied during the Monday session, crashing into the 0.7675 level. This is an area that continues to offer resistance, but if we can break above there I believe that the Australian dollar will continue to go much higher. This will be exacerbated if the gold markets rally, which be very well could. With this being the case, it’s very likely that the move could be violent, so therefore the Australian dollar may very well be the currency to own if we see that.
Pullbacks could very well find quite a bit of support just below, especially near the 0.75 handle. If we pullback from here, I believe that the buyers get involved on signs of support and of course bounces from below as the market continues to be very well supported. A break above the resistance above here of course is extraordinary, as we have been paying and guesses level for some time. However, you can just see where the buyers have been more and more aggressive recently, as the lows become higher. Longer-term, I’m very bullish of the Australian dollar and could very well be today that we break out.
