The EUR/JPY pair tried to rally during the session on Tuesday, but as a result of selling pressure, we ended up falling back down towards what I am starting to see as a potential trend line. The 140 level is massively supportive as well, so I think that this market could be ready to tell us something of significance. That being the case, I feel that the next 24 hours will in fact be very important for this market, and as a result I will be trading it quite yet, but I have a couple of different things that I will be watching for in order to place a larger trade.
The first thing that pay attention to of course is the uptrend line that I’ve drawn on this chart. Nonetheless, there is the 140 level as mentioned above, and more importantly the fact that we have incongruence of a couple of different things that could cause the market to boost, and the fact that the Euro has been sold off far too hard over the last several sessions. Yes, the European Central Bank is very unhappy with the elevated rate of the Euro, especially as the US dollar, but at the end of the day I feel that this is been overdone.
The Japanese yen
In general, I am short of the Japanese yen anyway. Granted, I don’t have a position in this market, but I recognize of the Japanese yen overall is weakening. I have shorted the yen fee in the Turkish lira, as well as the New Zealand dollar. I believe that the Euro won’t be any different, but it’s going to struggle a little bit at the moment as the Euro is the center of attention right now.
Even if we fell from here, I think there’s going to be a significant amount of support all down the 139, some not ready to sell quite that quickly. If we closed below the 139 level on a daily chart, then fine I would be a seller. Until then though, I’m looking for an excuse start going long in may find it, even if it’s on the short-term charts.
