Loading...
by Charalambos Pissouros

EUR/JPY Skyrockets and Hits Resistance Slightly Below 126.80

EUR/JPY skyrocketed on Friday, breaking above the downside resistance line drawn from the high of March 1st.  That said, the rally was stopped slightly below the 126.80 resistance zone, marked by the peak of March 20th, and today, the rate has been oscillating between that resistance and the 126.50 level. The pair is also trading above a tentative upside support line drawn from the low of March 28th, as well as above all three of our moving averages. So, having all that in mind, we would consider the near-term picture to be positive.

A clear break above 126.80 could confirm the case for further advances and may initially pave the way towards the 127.15 level, marked by an intraday swing low formed on March 4th. If the bulls are not willing to hit the brakes near that zone, then we may see them putting the 127.50 hurdle on their radars, defined by the high of March 1st. That said, bearing in mind that last week’s rally appears overstretched, a corrective retreat may be on the cards before the next positive leg. A dip below 126.50 could confirm the notion and perhaps open the door towards the 126.10 level from where the bulls could jump in again an drive the battle higher.

The case for a corrective setback is also supported by our short-term oscillators. The RSI has topped within its above-70 territory, while the MACD, although above both its zero and trigger lines, shows signs of topping as well.

In order to start examining whether the bears have gained the upper hand though, we prefer to wait for a break below 125.45, a support defined by the inside swing peak of April 10th. Such a dip would bring the rate back below both the aforementioned diagonal lines and could set the stage for the psychological number of 125.00. If that obstacle fails to halt the slide, then we could see extensions towards 124.80, near the low of the same day.

EUR/JPY 4-hour chart technical analysis

 Disclaimer:

The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval.

76% of the retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure.

Copyright 2019 JFD Group Ltd.

WEEKLY FINANCIAL NEWSLETTER
RIGHT INTO YOUR MAILBOX!
SUBSCRIBE TO JFD'S STRATEGIC REPORT