EURJPY Regains | Forex Reviews

The strengthening yen tends to be seen as a reflection of concern in the markets. Having threatened to form a recovery a few weeks ago, the bears have reclaimed control. This is why the latest breakdown on EURJPY is something to worry about (Forex Reviews).

EURJPY Regains | Forex Reviews

EURJPY – H4 – Long Term | Forex Reviews

At the moment the cross is up 0.17% at 121.29 and a surpass of 122.80 (20-day sma) would expose 123.88 (55-day sma) and then 124.25 (high May 31). On the other hand, the immediate support aligns at 120.75 (2016 low Jun.3) ahead of 118.74 (2013 low Feb.25). Just a fast bull trade. CCI and TDI showing bullish strength. First TP will be based on the 21 EMA (Green MA).

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EURJPY Bullish Butterfly

The closing break below the support of the May low at 121.50 has taken the pair to a new low dating back to April 2014. The concern from a technical perspective is that there is further downside potential. The RSI is deteriorating and is only just below 40, whilst the February sell-off plumbed the depths of the low 20s on the RSI. Also the Stochastics are negatively configured with further room for weakness. Selling into strength on EUR/JPY seems to be the strategy now, with the resistance in place between 121.45/122.00.

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Short Trade EURJPY 1H Buy

Alternatively, if prices rise back above 122.00 and break the May 31 high of 124.17 to clear the 50-day moving average resistance, this will pause the downtrend to indicate short term bottoming and bring about a more bullish outlook. Currently prices are testing the 50% Fibonacci at 121.94. Remaining above it is important, otherwise a deeper correction of the 94.09 – 149.76 upleg would shift the longer term bias to bearish.

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EUROJPY Possibly One More Drop

The daily technicals are supporting the bearish view. RSI is below 50 and MACD is below zero. The market is below the 200-day and 50-day moving averages, which are both sloping down. There is risk for further downside towards 121.00.

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Chart Of The Day – EURJPY

The RSI is deteriorating and is only just below 40, whilst the February sell-off plumbed the depths of the low 20s on the RSI. Also the Stochastics are negatively configured with further room for weakness. Selling into strength on EUR/JPY seems to be the strategy now, with the resistance in place between 121.45/122.00. The hourly chart reflects the bearish near term momentum and that the bulls would only realistically consider a rally as anything to get excited about on a move above 121.60, but even then the rally is stil just a rebound within the sharper downtrend which comes in around 123.00.

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After a short-lived test of the 121.80 area, EURJPY has managed to regain steam and advance to the 122.60 area, although losing vigour afterwards.

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