EUR/JPY Technical Analysis – Euro Set to Renew Downtrend?

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Talking Points:

  • EUR/JPY Technical Strategy: Flat
  • Support: 138.06 (23.6% Fib ret.), 136.68 (50% Fib ret.)
  • Resistance: 140.29 (Feb 11 high)

The Euro rebounded as expected against the Japanese Yen after showing a bullish Piercing Line candlestick pattern. Our decision to pass on a long trade setup yesterday proved prudent: prices reversed lower, forming a Bearish Engulfing candle setup and hinting at further weakness ahead.

Near-term support is at 138.06, the 23.6% Fibonacci expansion, with a break below that targeting the 38.2% level at 136.68. Near-term resistance is at 140.29, the February 11 high. Prices are too close to support to make a short trade here palatable from a risk/reward perspective and we will stand aside for now.

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dailyclassics_eur-jpy_body_Picture_12.png, EUR/JPY Technical Analysis – Euro Set to Renew Downtrend?

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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

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