EUR/JPY Technical Analysis: Sellers Try to Retake Initiative
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- EUR/JPY Technical Strategy: Flat
- Support: 146.08, 143.79, 141.95
- Resistance:148.59, 149.78, 151.20
The Euro declined as expected against the Japanese Yen following the appearance of bearish Dark Cloud Cover candlestick pattern. Near-term support is at 146.08, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 38.2% level at 143.79. Alternatively, a turn above the trend line support-turned-resistance at 148.59 clears the way for a challenge of the December 5 high at 149.78.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- 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.