USD/JPY
The USD/JPY pair initially tried to rally during the session on Thursday, but turned around to show signs of trouble as we closed near the bottom of the session. We are hanging about the 110 level, and this is an area that I think will attract a lot of attention. Because of this, it’s likely that the jobs number should have a massive effect on this market, and I think that a lot of people would have probably tried to lock in profits for the session before that volatile announcement. If we break above the 111 level, the market should then go to the 114 handle. However, if we break down below the bottom of the candle for the session, the market probably goes looking for the 108.50 level below. Ultimately, volatility can be expected.
AUD/USD
The Australian dollar initially fell during the session on Thursday, but turned around to break out to the upside. Ultimately, I believe that the 0.0 level above is going to continue to be significantly resistive, but if we do manage to break above there and more importantly, a close above there, I would be a buyer as it is a longer-term “buy-and-hold” signal. Gold markets have been rallying, and if that’s the case, the Australian dollar should continue to go much higher. I believe that the 0.78 level underneath should be a bit of a “floor, and the 0.79 level is essentially “fair value”. Because of this, I think that the volatility is going to increase, especially around the jobs number, so keep in mind that it’s likely that the markets will jump around significantly. I believe that there’s plenty of upward pressure, but we may get a pullback. That pullback could offer quite a bit of value if we can stay above the 0.78 handle.
