Here an update to the EUR/JPY position trading strategy as last mentioned in the week report here. In short, we’ve entered short at 127.80. Stop is placed at 129.30, slightly above 129.29 resistance.
Overall developments affirm our bearish view. The price actions from 127.49 as well as from 126.63 are corrective looking, suggesting fall from 133.12 is not over. EUR/JPY is also capped comfortably by 55 day EMA. Daily MACD is so far held in negative region. These are all bearish indications.
We’d expect a test on 126.63 after taking out 127.49 minor support. Break will resume the fall from 133.12 for a another take on 124.08 key support. We’d cautiously look at the reaction from there. But we’re leaning towards resumption of the down trend from 137.49 to 61.8% retracement of 109.03 to 137.49 at 119.90. So we’ll keep the target at 120.00 first.
