In today’s Forex Forecast, Wilson Leung of Trendsetter FX, offers the technical outlook for USD/JPY and EUR/USD, and further believes that a Fed rate hike tomorrow is unlikely.
USD/JPY: Buy the Dollar dips
Leung notes that USD/JPY has been consolidating in a triangle pattern from the past 3 weeks, the upside being around 121.74 and the downside at 118.60 area. He believes that the boost in risk appetite will result in selling pressure ahead in the Yen, and further suggests buying any Dollar dips.
If the Fed hikes rates tomorrow, Leung believes that USD/JPY will break to the upside of its triangle consolidation.
EUR/USD: 1.12 key for downside
EUR/USD is seeing a pullback, mostly due to a strong rebound in Cable on higher than expected wage growth in the UK, says Leung. He believes that further range trading is in sight for the EUR, but breaking below 1.12 will see additional downside towards the 1.11 area, while breaking above 1.1373 will be positive for the cross and upside towards 1.1450-1.1475 might be seen.
