EUR/JPY Technical Analysis: Corrective Bounce Underway
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- EUR/JPY Technical Strategy: Flat
- Support: 137.25, 136.15-30, 135.60
- Resistance:137.80, 138.69, 139.30-41
The Euro moved higher against the Japanese Yen as expected after prices produced a bullish Morning Star candlestick pattern. Near-term resistance is at 137.80, the 23.6% Fibonacci retracement, with a break above that on a daily closing basis exposing the 38.2% level at 138.69. Alternatively, a turn below the 14.6% Fib at 137.25clears the way for a challenge of the 136.15-30 area, intersection of a falling channel floor and the 61.8% Fib expansion.
The ECB looks to be the most dovish of the leading central banks, putting the Euro at a disadvantage against its major counterparts. With that in mind, we will opt not to pursue a long position and wait for the bounce to produce a selling opportunity.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.