- EUR/JPY has shown a break below major 50-DMA support at 121.72 on Monday's trade.
- Short-term bias in the pair has turned bearish after break below 50-DMA. Price action has dipped into daily cloud.
- The pair has dropped to hit fresh 5-day lows at 121.30 after BoJ held rates and revision lower its longer-run inflation forecasts.
- We now see scope for test of 120.58 (23.6% Fib retrace of 109.20 to 124.09 rally and Jan 18 low).
- Violation there could see test of 118.70 (trendline support).
- Focus now on German retail sales data due to be reported ahead of the European open.
- ECB Draghi’s speech, BOJ Kuroda’s presser, German jobs data, Eurozone CPI and GDP reports will also draw close attention.
TIME TREND INDEX OB/OS INDEX
1H Bearish Oversold
4H Bearish Neutral
1D Bearish Neutral
1W Neutral Neutral
Support levels - 121, 120.58 (23.6% Fib retrace of 109.20 to 124.09 rally and Jan 18 low), 118.70 (Trendline and Dec 5 low)
Resistance levels - 121.65 (cloud top), 121.80 (50-DMA), 122 (5-DMA), 122.95 (Jan 20 high)
Recommendation: Good to go short on rallies around 121.45/60, SL: 122, TP: 121/ 120.60/ 120
FxWirePro Currency Strength Index: FxWirePro's Hourly EUR Spot Index was at -41.0447 (Neutral), while Hourly JPY Spot Index was at 131.321 (Highly bullish) at 0600 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
