EURJPY- Daily

EURJPY –

Midway through the year, it appeared the Euro had found an edge against its Japanese counterpart with increased demand push the pair to price highs last seen in early 2019. However, the last few weeks have brought about a double whammy of virus lockdowns in Europe and more jittery Brexit negotiations as the final deadline draws nearer. As we study the EURJPY daily chart, one thing is for sure; these latest developments have upset the Euro apple cart.

Using the Ichimoku method, we see the wheels began to fall off towards the end of September as the price slipped below the cloud. Initially, price action attempted to regain lost ground, but ultimately the cloud resistance proved too strong, and EURJPY failed to recover.

At the time of writing, we’ve seen a steady sell-off for three consecutive days, and demand for the Yen continues to grow. Should this downward move extend, there are a few potential targets worth mentioning. Firstly, using a Fibonacci retracement from the 127.07 high to the May low of 114.39, we find the current price is near the 50% level of 120.85. Incidentally, this area has acted as support throughout July too. Below the first target, we have another key area of support located at 119.31.

Despite the bearishness, there is scope for a price pull-back due to the latest moves’ impulsive nature. If this occurs, the current weekly pivot of 122.60 could provide some resistance before testing the cloud’s lower regions.

Ultimately, with the sheer number of fundamental drivers acting as market catalysts over the coming weeks, EURJPY might be in for some considerable price swings. Technically speaking, the short to medium-term outlook remains bearish.

 

Note: Click on charts to enlarge.

 

By Adam Taylor CTEe

.@adamt_trading

Sources: Go Markets, Meta Trader 5, TradingView, Bloomberg

Disclaimer: The articles are from GO Markets analysts,  based on their independent analysis or personal experiences. Views or opinions or trading styles expressed are of their own;  should not be taken as either representative of or shared by GO Markets.  Advice (if any),  are of a ‘general’ nature and not based on your personal objectives, financial situation or needs.  You should therefore consider how appropriate the advice (if any) is to your objectives, financial situation and needs, before acting on the advice.  If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) for that product before making any decisions.

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