In today’s forex forecast, we discuss the technical outlook for USD/JPY and EUR/USD, with Wilson Leung, Director for Trendsetter FX.
USD/JPY: Buy for a re-test of last week’s high
Leung notes that USD/JPY registered a 12-week high at 123.77 after which Yen buying triggered due to geopolitical events pushed the cross lower towards 122.21.
He further suggests buying the pair at the 13 DMA and targeting last week’s high, but adds that USD/JPY moving below 121.74 will cancel this bullish call and see a pullback towards 120 area.
EUR/USD: 1.08 before parity
Leung believes that EUR/USD will likely see 1.08 levels before heading towards parity. He says that the market is overwhelmingly bearish on the cross, with the single currency being heavily oversold. Leung sees risks for a short-covering rally ahead, and suggests using any corrective rebound towards 1.07 area as a sell opportunity.
Leung further says that next week will be key for the pair.
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