EUR/JPY Technical Analysis – Passing On Long Trade Setup
Dailyfx | Apr 14, 2014 12:58AM ET
Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 140.40 (rising trend line)
- Resistance: 141.75 (38.2% Fib exp.), 142.81 (falling trend line)
The Euro may be on the verge of a reversal higher against the Japanese Yen after prices put in a bullish Piercing Line candlestick pattern above a rising trend line set from February. Near-term resistance is at 141.75, the 38.2% Fibonacci expansion, with a break above that targeting a downward-sloping barrier at 142.81. Trend line support is now at 140.40.
While risk/reward considerations allow for a long position at current levels, we will tactically opt to stand aside. Prices continue to show a significant correlation with the S&P 500 and the benchmark equity index looks vulnerable to deeper losses, warning that EUR/JPY may be pulled down amid broader risk aversion. With that in mind, we will stand aside.
Daily Chart - Created Using FXCM Marketscope 2.0
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