EUR/JPY Appears Longer Term Bullish; EUR/USD May Correct Lower
This is a recording of a US Opening Bell webinar from May 8, 2017.
In today’s US Opening Bell webinar, we discussed technical patterns on key markets. We’ve been tracking EUR/JPY since mid-April and the break above the trend channel is a longer term bullish signal. Prices did finally tag our 124.00 target from when the initial pick was established and the near term impulsive move appears mature.
Many times, after a successful break of a trend line, prices double back and retest the broken trend line. In this case, the trend line is near 122 so we won’t be alarmed if prices did soften to 122 or possibly 120.
We previously wrote about EUR/USD on Friday before the French election and how the higher probability pattern appears to be lower. 1.0880 is a level where, if broken, may provide an early warning signal of additional losses.
USD/JPY sentiment flipped for the first time since early January 2017. Though this trend may mirror EUR/JPY and be mature to the upside, if sentiment continues to hold as net short, then it could spell further gains. Grab the guide on how to trade with sentiment and view the live USD/JPY sentiment reading here.
Fed funds futures are suggesting the Fed will hike rates in the June 2017. Read page 2 of our quarterly Yen forecast to see how Japanese Yen behaved in the past during Fed rate hikes.
---Written by Jeremy Wagner, Head Trading Instructor, DailyFX EDU
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.