News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
EUR/JPY Technical Analysis: Long-Term Support, Short-Term Resistance

EUR/JPY Technical Analysis: Long-Term Support, Short-Term Resistance

James Stanley, Senior Strategist

To receive James Stanley’s Analysis directly via email, please sign up here.

Talking Points:

  • EUR/JPY Technical Strategy: Long-term bullish, intermediate-term: mixed, short-term: range-bound.
  • EUR/JPY dropped yesterday after a dovish ECB outlay; but has since found support around a longer-term level, and is currently testing short-term resistance.
  • If you’re looking for trading ideas, check out our Trading Guides. If you’re looking for shorter-term ideas, check out our IG Client Sentiment.

In our last article, we looked at the bearish swing in EUR/JPY after price action put in a ‘failure high’ in the week prior. But given the fact that buyers had continued to show-up around a longer-term support zone that carries a rather bullish connotation around 123.22, the long-term trend continued to offer bullish perspective as buyers retained support at the 23.6% retracement of the ‘bigger picture’ bullish move.

Since then, we’ve had a number of negative factors for EUR/JPY show up, including a very dovish European Central Bank meeting yesterday. Price action tested prior lows around 122.50 but, again, bulls remained rather vigilant as that dip was bought and price action perched back-above support at 123.22.

EUR/JPY Technical Analysis: Long-Term Support, Short-Term Resistance

Chart prepared by James Stanley

On shorter-term charts, we can see where price action in EUR/JPY is testing near-term resistance around 123.75.

EUR/JPY Technical Analysis: Long-Term Support, Short-Term Resistance

Chart prepared by James Stanley

Given that we may potentially be at a turning point for a return of bullish price action, the door can be opened for topside continuation strategies. Traders looking to exude a bit more caution can wait for near-term resistance around 124.07 (the ECB swing-high) to give way as a bit of additional confirmation that this short-term strength might continue in the direction of the longer-term trend.

Stops for bullish strategies can be investigated below this recent ‘higher-low’ in the 122.75 area; but for those that want to maximize distance on the entry, stops can be investigated below the ‘bigger picture’ swing-low of 122.50.

--- Written by James Stanley, Strategist for DailyFX.com

To receive James Stanley’s analysis directly via email, please SIGN UP HERE

Contact and follow James on Twitter: @JStanleyFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES