EURJPY Rally at Risk sub 1.4450- Short Scalps Eye Weekly Lows
- EURJPY responds key resistance barrier
- Scalps target downside correction / long entries lower down
- Event risk on tap this week
Chart Created Using FXCM Marketscope 2.0
- EURJPY tests 2013 high-day close- 144.50/69 now key resistance (bearish invalidation)
- Interim support 143.20, 142.08/19 (weekly ORL) & 141.00/26- bullish invalidation
- Momentum signature remains constructive
- Look break sub-60 in daily RSI to confirm correction
- Event Risk Ahead: Japanese Machine Orders & Industrial Production tomorrow, Eurozone & German GDP numbers later this week.
Notes: Momentum divergence into the highs at pitchfork resistance has shifted our near-term focus lower in the EURJPY with a break below 143.20 targeting the weekly opening range low at 142.08/19. Note that the pair is trading within an embedded pitchfork off of the October lows with today’s rally spiking into the median line before turning over. A move below the weekly low would confirm a near-term reversal with such a scenario eyeing the key support at 141.00/26 & the Andrew’s pitchfork median line.
Bottom line: looking to sell rallies below today’s high with a break of the weekly opening range low warranting short exposure into key support. Keep in mind that the broader bias remains constructive and we’ll treat any turnover here as a correction for now. A breach through the highs invalidates our bias with such a scenario eying the 2013 high at 145.67. Use caution heading into event risk later this week with GDP data out of Germany and the broader Eurozone likely to fuel added volatility in EUR crosses.
* 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 Economic Releases
Other Setups in Play:
- Scalping the AUDUSD Reversal- Longs Favored Above 8600
- EURUSD Scalps Target 1.26 Ahead of ECB / NFPs
- NZDUSD Scalps Target 2013 Low- Breakdown Risk Below 7800
- USDJPY Presses Resistance Ahead of BoJ- Support at 108.87
- GBPJPY Long Scalps at Risk Ahead of UK GDP- 174 in View
---Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
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