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Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 135.81, 134.92, 133.48
- Resistance:137.26, 138.43, 139.60
The Euro advanced to a three-month high against the Japanese Yen but upside follow-through appears questionable. A daily close above the 38.2% Fibonacci expansionat 137.26 exposes the 50% level at 138.43. Alternatively, reversal below the 23.6% Fib at 135.81 clears the way for a test of the 14.6% expansion at 134.92.
While entering long seems initially compelling, negative RSI divergence hints at ebbing upside momentum and warns against betting on upside follow-through. With that in mind, we will tactically opt to stand aside for now and wait for a more attractive opportunity to emerge.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
