EUR/JPY Technical Analysis: Passing on Long Trade Setup
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- EUR/JPY Technical Strategy: Flat
- Support: 136.83, 135.80, 135.16
- Resistance: 137.67, 138.51, 139.54
The Euro looks to be trying to resume an expected rebound against the Japanese Yen following a two-day corrective pullback. Near-term resistance is at 137.67, the 50% Fibonacci retracement, with a break above that on a daily closing basis exposing the 61.8% level at 138.51. Alternatively, a turn back below the 38.2% Fib at 136.83 clears the way for a test of the 23.6% retracement at 135.80.
Prices overcame resistance at 136.83 by a mere 8 pips on a closing basis, casting doubt on the breakout considering a 20-day ATR reading of 106 pips. Furthermore, the ECB remains the most dovish of the major central banks, making us leery of buying the Euro. On balance, we will stand aside.
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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.