Start the week of Aug. 1, 2022 off right with our Forex forecast focusing on major currency pairs.

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AUD/USD

The AUD/USD currency pair initially tried to rally last week to break above the 0.70 level, but it fell from there instead. The 0.70 level is a significant round figure that a lot of people have paid attention to, and it has offered quite a bit of support multiple times. However, if we were to break above the 0.7050 level, then we could go looking to the 0.72 level next.

Ultimately, I think we will probably continue to look at this as a “fade the rally” scenario. The market could also fall down to the 0.68 level.

USD/JPY

The USD/JPY currency pair initially tried to rally last week, but it found the area above the JPY135 level to be a bit too much. Now that we have broken down below there, the market has reached the JPY133.50 level. The market appears to be reaching a support level in the range of JPY131.50, which is where I think we are likely to find buyers.

Keep in mind that the Bank of Japan continues to buy government bonds in an unlimited amount. This is essentially the same thing as quantitative easing, so it’s worth noting that the longer-term trend should hold.

EUR/USD

The EUR/USD currency pair has gone back and forth over the course of the week, and it now looks like we are trying to figure out whether we are going to rise or fall, as the candlestick is somewhat neutral.

That being said, the parity level is just below and should offer a significant amount of support. To the upside, the 1.04 level should serve as a massive amount of resistance. Ultimately, this is a market that I think continues to see a lot of noisy behavior more than anything else.

GBP/USD

The GBP/USD pair rallied significantly last week to reach above the 1.22 level, only to turn around and fall. Ultimately, the market still looks as if it’s going to try to fight its way to the upside, but given interest rates in the United States, this is all about the US dollar and the possibility that the Federal Reserve could pivot. That being said, the market is trying to price something in, so it may be wise to pay attention to the 10-year yield.

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