EUR/JPY Technical Analysis: May Top in the Crosshairs

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Talking Points:

• EUR/JPY Technical Strategy: Flat
• Support: 134.92, 133.48, 132.08
• Resistance:135.81, 137.26, 138.43

The Euro continued to recover for a second consecutive day against the Japanese Yen, with prices now seemingly poised to monthly highs below 136.00. Near-term resistance is at 135.81, the 23.6% Fibonacci expansion, with a break above that on a daily closing basis exposing the 38.2% level at 137.26. Alternatively, turn below the 14.6% Fib at 134.92 opens the door for a challenge of the May 11 low at 133.48.

The available trading range is too narrow to justify entering a trade on the long or short side from a risk/reward perspective. With that in mind, we will remain flat for now, waiting for price action to offer a more compelling opportunity down the road.

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Daily Chart - Created Using FXCM Marketscope

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com