The 61.8% Fibo extension of the 112.22-139.29 advance lies just below and could limit downside risks. The pair broke below the level on Greece induced panic which discounts the significance of the move, maintaining the level’s credibility. Rising trendline support on a short-term basis is also converging which could fortify the level. Therefore, with yen strength favored at this time the brief bout of consolidation makes the pair an ideal scalping target.
Quantitative Metrics
A wide Bollinger band width of 1287 pips for the EUR/JPY is a product of the current bearish trend and a red flag for scalpers. Adding to the concerns over the pair as a target is the ascending ATR at 185 pips which is the second highest of the most traded pairs. An elevated one week implied volatility reading of 15.11 is a sign that volatility will return and limit’s the pair’s time frame for generating profits.
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