Euro Price Outlook: EUR/USD, EUR/JPY Hammered at Resistance – What is Next?
EUR/USD and EUR/JPY Outlook
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EUR/JPY, EUR/USD – In The Red
Last week, EUR/USD traded lower then closed the weekly candlestick in the red for the first time in September with a 0.4% loss. On the other hand, on Friday EUR/JPY closed with a 0.9% loss reflecting a clear hesitation from the buyer’s side.
The Relative Strength Index (RSI) failed twice to cross above 50 on EUR/USD emphasizing the downtrend momentum was still intact. Regarding EUR/JPY on Friday, the oscillator crossed below 50 indicating to possible move to the downside.
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EUR/USD Daily PRice CHART (AUg 1, 2018 - SEp 23, 2019) Zoomed Out
EUR/USD Daily Price CHART (June 5 – Sep 23, 2019) Zoomed in
Looking at the daily chart we notice, since Wednesday EUR/USD has been showing weakness signs. The price declined to a lower trading zone 1.0912 – 1.1050 and currently, eyes a test of the low end as discussed in our last update.
Thus, a close below the low end could send EURUSD towards 1.0812. Nonetheless the weekly support area and levels underscored on the chart would be worth monitoring. See the chart to know more about the lower trading zone and support level to consider in a further bearish move.
On the flip-side, any failure to close below the low end of the zone highlights seller’s hesitation/ likelihood of taking profit at this stage. This could send EURUSD towards the high end. Further close above the high end may see the price trading even higher towards the vicinity of 1.1215-20. However, the weekly resistance levels underlined on the chart should be watched closely.
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EUR/JPY Daily PRice CHART (Jan 2, 2017– Sep 23, 2019) Zoomed Out
EUR/JPY Daily PRice CHART (June 24 – SEp 23, 2019) Zoomed In
From the daily chart, last week EUR/JPY buyers failed at multiple occasions to push the price towards a higher trading zone. Hence, sellers took the initiative and pressed the pair lower eying a test of the low end of current trading zone 117.30 – 119.78.
Thus, a close below the low end could embolden sellers to send EURJPY even lower towards the vicinity of 114.94-80. That said, the weekly support areas and level marked on the chart (zoomed in) should be kept in focus.
On the other hand, any failure to close below the low end could reverse the trend towards the high end of the zone. Further close above the high end may push EURJPY towards 121.25. Although, the weekly support levels underlined on chart need to be considered.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.