- EUR/JPY slips below 120 handle, we see scope for test of 100-DMA at 118.55.
- Political uncertainty in France which has pushed the French-German yield spread to four-year high weighs on the EUR.
- The pair remains capped below 20-DMA, price action has dipped into daily cloud.
- Short-term bias in the pair has turned bearish after break below 50-DMA.
- Strong support at 120.58 (23.6% Fib retrace of 109.20 to 124.09 rally and Jan 18 low) has been breached.
- We now see test of 118.70 (trendline support) and then 118.55 (100-DMA).
TIME TREND INDEX OB/OS INDEX
1H Bearish Oversold
4H Bearish Oversold
1D Bearish Neutral
1W Bearish Neutral
Support levels - 119.45 (Nov 30 low), 119, 118.70 (Trendline and Dec 5 low), 118.55 (100-DMA)
Resistance levels - 120.58 (23.6% Fib retrace of 109.20 to 124.09 rally), 120.91 (5-DMA), 121.62 (20-DMA)
Recommendation: Good to go short on rallies around 119.80/90, SL: 120.60, TP: 119.45/ 119/ 118.70/ 118.55
FxWirePro Currency Strength Index: FxWirePro's Hourly EUR Spot Index was at -83.3645 (Bearish), while Hourly JPY Spot Index was at 161.074 (Highly bullish) at 0600 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
