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EURJPY Scalps Target Critical Support at 141

EURJPY Scalps Target Critical Support at 141

2014-04-29 16:59:00
Michael Boutros, Strategist
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Talking Points

  • EURJPY fails at 61.8% retracement- momentum at resistance- bearish
  • Weekly opening range break to validate- Critical support 141
  • Major event risk on tap from Eurozone, Japan, and US

EURJPY Daily Chart

EURJPY Scalps Target Critical Support at 141

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • EURJPY in consolidation off the 2014 high
  • Signals near-term exhaustion above 61.8% retracement of April decline
  • Daily RSI signature looks to hold below trigger confluence, sub 60- bearish
  • Critical support objective at 140.89/98
  • Subsequent support targets 140.00, 1.3874-139.10
  • Resistance at 142.45, 14260/71- bullishinvalidation
  • Event Risk Ahead: Eurozone CPI on Wednesday and Japanese Jobless Rate on Thursday

EURJPY Scalp Chart

EURJPY Scalps Target Critical Support at 141

Notes: Weaker than expected German CPI data this morning prompted a bout of euro weakness, triggering a sharp reversal in the EURJPY. The weekly opening range is set between 140.98-142.46. RSI divergence and a clear support-trigger break earlier today has our immediate focus on the short-side against today’s high’s with a break below the weekly range low at the 61.8% retracement needed to validate our near-term scalp bias.

Keep in mind tomorrow is the last day of the month and although there’s no pressing data out of Japan until Thursday, the FOMC policy meeting could impact broader market sentiment. Bottom line: we’ll continue favor selling rallies while below the weekly low with only a move surpassing 142.60/70 suggesting that a more significant low was put in place this month. Our primary support objective at the 141-handle remains paramount with a break/close below risking substantial losses into subsequent support targets at 140 and 139.10.Follow the progress of this trade setup and more throughout the trading week with DailyFX on Demand.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

Entry/Exit Targets

Timeframe

Level

Significance

Resistance Target 1

30min

141.89/98

61.8% Ext / 23.6% Retrace / Last Week’s High

Resistance Target 2

Daily / 30min

142.16

61.8% Retrace / Dec 10th High / Soft Resistance

Resistance Target 2

Daily / 30min

142.45

Weekly ORH / Weekly R2 Pivot

Bearish Invalidation

30min

142.60/71

1.618% Ext / Swing low 4/2

Break Target 1

30min

143.08

88.6% Retracement / ~TL Resistance

Break Target 2

30min

143.46

April High

Break Target 3

Daily / 30min

14365/81

78.6% Retrace / 100% Ext / March High

Support Target 1

30min

141.55

38.2% Retracement

Support Target 2

30min

141.20

38.2% Extension

Bullish Invalidation

Daily / 30min

140.89/98

Weekly ORL & S1 Pivot / 61.8% & 38.2% Retrace(s)

Break Target 1

30min

1.4042/58

78.6% Retrace / 61.8% Ext

Break Target 2

Daily / 30min

139.89 – 140.00

50% Retrace / 61.8% & 78.6% Ext(s)

Average True Range

Daily (20)

86

Profit Targets 20-22pips

*ORH: Opening Range High

*ORL: Opening Range Low

Other Setups in Play:

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael for Live Scalping Webinars Wednesday and Thursday this week on DailyFX Plus (Exclusive of Live Clients) at 12:30 GMT (8:30ET)

Interested in learning about Fibonacci? Watch this Video

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