EUR/JPY Forex Technical Analysis for June 16, 2016

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EUR/JPY Forex Technical Analysis for June 16, 2016

Technical Analysis – The EUR/JPY pair initially tried to rally during the day on Wednesday, but turn right back around to form a bit of a shooting star. When you form a shooting star at the bottom of the downtrend, and it normally means it’s are going to see continuation so therefore we are sellers. A currently looks as if the 120 level will offer a significant amount of resistance, so at this point in time it’s “sell only” until we break well above that level. At this point in time, we have a target of 115 but realize it is going to take some time to get down there.
This makes a lot of sense, because the EUR/JPY pair tends to be very sensitive to risk around the world, and right now there is more than enough of it to make the markets a bit skittish. The Japanese yen is a very “safety minded” type of currency play for the Forex markets around the world, so it makes sense that we would be running from the Euro, which of course has to worry about whether or not the United Kingdom is going to be part of the European Union soon, and running towards the relatively safe Japanese currency.
The 115 level is the target longer-term, mainly because it is a large, round, psychologically significant level. I believe eventually we will get down there but it is going to be very choppy below. After all, we have sold off rather drastically over the last couple of weeks so we have to wonder whether or not there is still selling pressure to be had without some type of momentum building first. Rallies will be used as that, and therefore I look at rallies as opportunities to sell on signs of exhaustion with the short-term charts. In fact, I don’t really have a scenario at this moment where I’m looking to buy this particular currency pair as it has been so bearish for the longer term, and I believe that a lot of volatility will continue to plague the Euro.

In Other View Point – EUR/JPY tumbles to 117.00 after BOJ holds fire

Yen continues to surge on global risk-off sentiment, with the EUR/JPY cross now trading well below 118.00 handle at the lowest level since Jan. 2013 after BoJ inaction prompted traders to cover their bearish bets against the Japanese currency.

After the FOMC decided to keep its benchmark interest rates unchanged on Wednesday, BoJ followed suit and left its deposit rate and, asset-purchase target, unchanged as we now head towards monetary policy decision announcements from SNB and BoE.

On Wednesday, the EUR/JPY cross attempted a tepid recovery as global risk-on rally diminished the safe-haven appeal of the Japanese currency. On Thursday, global equity markets sell-off triggered a fresh bout of safe-haven buying boosted JPY sharply across the board.

Market participants will now look for some respite from the release of final May CPI print from the Euro-zone during European trading session.

Technical levels to watch

Sustained weakness below 117.00 handle seems to trigger a fresh leg of selling pressure, that might drag the pair below 116.00 round figure mark, towards 115.50 support area, With daily RSI already indicating highly oversold conditions, any further weakness below 115.50 support seems unlikely. Meanwhile on the upside, 118.00 round figure mark, closely followed by 118.70-75 horizontal area, now seems to act as immediate resistance levels. Any further recovery beyond these immediate resistance levels might now be capped at 119.00 important support break-point, turned resistance

In Other View Point – EURJPY:BULLISH BAT PATTERN (Technical Analysis)

Completing zone will be 100-102 Let’s see how the market reacts!

Technical Analysis

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