EUR/JPY Consolidating In Familiar Range
Dailyfx | Aug 20, 2014 03:08AM ET
Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 136.22-27, 135.55, 135.18
- Resistance:137.62, 138.80, 139.75
The euro is trying to build higher against the Japanese yen as expected after positive RSI divergence was spotted on a test of February’s swing bottom. A daily close above the 23.6% Fibonacci retracement at 137.62 exposes the 138.65-80 area, marked by the 38.2% level and a falling channel top. Alternatively, a turn below support in the 136.22-27 zone, bracketed by the February 4 low and the 23.6% Fib expansion, opens the door for a challenge of the channel floor at 135.55.
The ECB looks to be the most dovish of the leading central banks, putting the Euro at a disadvantage against its major counterparts. With that in mind, we will opt not to pursue a long position and wait for the bounce to produce a selling opportunity.
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