Over the past couple of week’s we’ve been following a rather pensive test of a long-term support zone in EUR/JPY. Throughout most of last year, EUR/JPY remained in a bullish trend that kept some very clean characteristics; key of which was what happened around the October ECB rate decision. This is when the ECB extended their stimulus program, disappointing the hopes that had built for some type of announcement around taper or stimulus exit. This led ...
EUR/JPY capped off what was an impressively strong 2017 by continuing to show strength in the first few trading days of the New Year. But, after an evening star formed around the close of the first week of the year, prices continued to drop as worries about a ‘stealth taper’ from the Bank of Japan created considerable Yen strength. This amounted to a pull-back in the previously ebullient trend of EUR/JPY, and as we wrote last week, prices ...
After a topside breakout, EUR/JPY traded up to another new high at 134.41. This is a key Fibonacci level, as 134.41 is the 61.8% retracement of the 2014-2016 major move in the pair, and this is helping to set near-term resistance. That resistance came into play on Friday morning, and after grinding around this level for a few hours, sellers took over and drove prices lower. And that retracement continued with aggression until another support ...
Friday’s NFP report had the potential to re-stoke risk aversion, and price action in the Yen indicated as such in the immediate aftermath of the print as we finally saw prices break below 121.50, printing a lower-low at 120.81 ahead of last week’s close. But since, we’ve seen bullish price action thus far on the new week, and with yet another false down-side breakout in EUR/JPY, traders should approach short-side continuation strategies with caution. ...
The current price action formation on the daily chart of EUR/JPY is a descending wedge, and this can be found by connecting the swing high on March 31st with the swing high to April 27th to define resistance; while that confluent support zone between 121.50-122.50 continues to stem the declines. This support has held for the better part of three-and-a-half months; and at this point traders would likely want to see a concerted break before looking for down-trend continuation setups. ...
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