Current trend
After the Chinese authorities devalued the Yuan, the US Dollar strengthened against most major currencies and against the Euro as well. The single currency also declined against the save-haven Yen. However, during the European session, the Euro managed to strengthen and keeps growing.
Support and resistance
The EUR/JPY pair is likely to be trading within 138.10 (50% Fibonacci) and 132.25 (23.6% Fibonacci and EMA144 on the daily chart).The price will be near 136.00 (EMA200/144/50 on the daily chart) and 135.50 (Fibonacci 38.2%). Only the breakout and consolidation above one of the levels would determine the further long-term movement.
Currently, the pair is at the upper level of the range (138.10), however, OsMA and Stochastic on the 4-hour and daily charts indicate a strong “bullish” impetus. Thus, it is too late to buy, but too early to sell. Open short positions when indicators on the 4-hour chart give appropriate signals.
Support levels: 132.25, 133.70, 135.00, 135.50, 136.00, 137.00.
Resistance levels: 138.10, 138.70, 139.40.
Trading tips
Place pending sell orders from 137.90, 138.10, 138.30 with targets at 137.00, 136.30, 136.00, 135.50, 135.10. Set further targets at 133.70, 132.25, 127.00 (2015 lows) and stop-loss at 138.80.
Open alternative long positions when the price breaks through 138.10 and consolidates above 138.70. In this case, targets will be 139.00, 140.00, 140.75 (Fibonacci 61.8%)
