EUR/JPY Forex Technical Analysis for June 14, 2016
Technical Analysis – The EUR/JPY pair went back and forth during the course of the day on Monday, bouncing back and forth but found the 120 level to be far too resistive. That being the case, looks as if the sellers are still very much in control, and they of course have a 50 day exponential moving average above offering quite a bit of resistance as well. With that being the case, I believe that any rally at this point in time will be sold off, just as a break down below the bottom of the range for the day will be.
In other view point – EUR/JPY hits multi-month lows, on verge of “inverted saucer”(Technical Analysis)
On daily charts , the pair has broken supports at 121.692 levels that is where the prices have slid below DMAs.
As you can probably observe bears in the long run have been slipping through the sloping channel, and they manage prices to stay below DMAs, current dips likely to extend up to channel support.
To substantiate this bearish stance, 21DMA has crossed over 7DMA which is a sell signal.
MACD is also not deviating from this call, it’s been oscillating below zero level which is a bearish trajectory.
Currently, on daily plotting RSI (14) trending below near 33 levels (while articulating) clearly converging to the current price declines to signify the momentum in selling pressures.
While Stochs have reached below 20 but still popping up with %D crossover to signal the selling momentum.
On a broader perspective, we traced out an “inverted saucer pattern” that can extend the price declines up to 115.502 levels. It is trading at 3-year lows at the moment.
Moreover, the break below 122.028 may also expose to 61.8% Fibonacci retracements, current prices remain well below EMAs, the down-trend has been slipping through falling wedge (see monthly plotting). Hence, it is perceived as on-going downtrend would prevail further.
As stated earlier in our previous long-term trend analysis the pair is forming a sloping channel and more downside targets are on the cards. Bears have completely taken the control over the rallies to evidence every dip with ease and with huge volumes (see weekly & monthly charts for volumes conformity).
The most probable scenario would be that it may test 115.502 levels as a next strong support.
Hence, using these deceptive rallies, it is smart to stay short in mid-month futures for above mentioned targets, alternatively on intraday speculative mindset, one can eye on buying one touch delta binary puts for maximum targets of 118.978 to give leveraging effects to the profitability where the current implied volatility of this pair is considerably higher, a tad below 18%.
In other view point – (Technical Analysis) EUR/JPY drops to 118.70, lowest since January 2013
The increasing selling pressure around the single currency is now sending EUR/JPY to test fresh lows in the 118.80 area.
EUR/JPY weaker on Bunds, risk aversion
The common currency met further downside pressure in response to declining yields in German Bunds, with the 10-year benchmark testing the 0% level.
The dominating risk aversion context continues to favours the Japanese safe haven, prompting market participants to ignore auspicious results from EMU’s Industrial Production during April and Employment Change in Q1.
EUR/JPY relevant levels
At the moment the cross is losing 1.18% at 118.71 and a breach of 116.42 (low Jan.16 2013) would expose 113.54 (low Jan.9 2013) and finally 105.93 (monthly low Dec.10 2012). On the other hand, the next up barrier lines up at 120.32 (high Jun.13) ahead of 121.81 (20-day sma) and then 122.74 (low Jun.7).