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Talking Points:
- EUR/JPY Strategy: Short at 118.10
- Euro drops to four-month low vs. Yen as selloff gains momentum
- Break of chart support hints sellers now aiming at 117.00 figure
The Euro has dropped to the lowest level in over four months against the Japanese Yen, with a break of chart support now seemingly exposing the 117.00 figure. A corrective bounce reversed at trend resistance set from mid-December has now been entirely erased.
Near-term support is now at 117.03, the 100% Fibonacci expansion, with a break below that opening the door for a test of the 123.6% level at 115.65. Alternatively, a move back above the 76.4% Fib at 118.42 sees the next upside barrier at 119.27, the 61.8% expansion.
Final profit was booked on a short position triggered at 122.65 as prices bottomed above 118.00 in late February. Re-entering the trade now looks compelling and another short has been initiated at 118.10. The trade initially targets 117.03. A stop-loss will be activated on a daily close 118.42.
Why is EURJPY a top trading idea for 2017? See the fundamental strategy here.
