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Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 133.00, 130.13, 128.25
- Resistance:134.77, 137.64, 139.95
The Euro may have formed a bottom above the 130.00 figure against the Japanese Yen after prices completed a bullish Morning Star candlestick pattern. Near-term resistance is in the 134.13-77 area, marked by the October 16 low and the 23.6% Fibonacci retracement, with a break above that on a daily closing basis exposing the 38.2% level at 137.64. Alternatively, a turn below the 14.6% Fib at 133.00 clears the way for a challenge of the January 26 low at 130.13.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish 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
