- The EUR/JPY has pulled back just a bit during the trading session on Thursday, as we are struggling to go much higher.
- We are back to the 143 level, and it’s likely that we will continue to see a lot of noise.
- The market will continue to see a lot of noise due to the fact that the Japanese yen itself is so noisy. Remember, the Bank of Japan continues to do everything it can to keep interest rates down, so therefore they are printing yen.
Looking at this chart, you can see that we are pulling back toward the previous resistance barrier, so it should now be a support level. By retesting the breakout, and sitting here, we are in the area where we could see a little bit of a bounce. If we could bounce from here, that would be a classic “breakout and retest” type of setup. At that point, I would anticipate that this market could go to the ¥146 level, given enough time. That’s an area where we had seen a lot of selling pressure in the past.
A Lot of Downward Pressure on the Japanese Yen
On the other hand, if we break down to the 50-Day EMA, and then eventually break down below there, it’s likely that we could go looking to the 200-Day EMA. The 200-Day EMA is an indicator that a lot of people pay attention to, and it is currently sitting just above the ¥140 level, which of course is a large, round, psychologically significant figure. Breaking down below there then opens the possibility of ¥138, which is where we had tried to bottom from previously.
Nonetheless, this looks to me like a market that is doing everything it can to turn things around, and I also would point out the fact that we have the Japanese yen selling off against almost everything, so I don’t necessarily know that will be any different here. It’s not necessarily that I like the Euro itself, it’s just that I recognize that we have a lot of downward pressure on the Japanese yen, and we’re seeing it everywhere. I don’t think this market changes that, and it certainly doesn’t look very likely to go in the opposite direction of every house.
Ready to trade our daily Forex forecast? Here’s a list of some of the best currency trading platforms to check out.