The EUR/JPY continues to challenge higher resistance levels. Early December has seen a sustained barrage of attempts to break the 126.700 level without a breakthrough occurring, but speculators may continue to be attracted to the notion that the EUR/JPY trend will remain bullish and attempt to pursue upward momentum.
Global equity indices have been slightly mixed early today, but this developed after higher values continue to be attained and stock exchanges maintain record paces. Risk appetite is not likely to disappear short term, and this will likely create further speculative fever within Forex pairs like the EUR/JPY, which has the ability to trend in significant ways. The current highs of the EUR/JPY are challenging important resistance levels also seen in August of this year before a wave of cautious trading shadowed global equity markets.
The EUR/JPY has experienced choppy trading in the past few months, but it has managed to sustain a long-term bullish trend since May. The choppy conditions which sometimes occur in the Forex pair should serve as a reminder that it is difficult to find one-way avenues while trading and risk management must remain a staple of all speculative accounts.
Resistance levels at these heights has caused reversals lower before, which was demonstrated in August and September. While the past handful of days have also seen headwinds for the EUR/JPY emerge at its current price levels, traders should contemplate the notion that the Forex pair may be ready to break through resistance levels in the near term. If resistance is brushed aside, it will almost definitely have to occur within the midst of another drive upwards by the major global equity indices, including the Nikkei Index. The absence of a serious reversal lower may also bolster speculative optimism regarding a possible climb higher above current resistance.
As the holiday season approaches and risk appetite remains steady to positive, new highs may be attained on equity indices and within the EUR/JPY. If the EUR/JPY can break the important resistance level of 126.600 and create a battle upwards towards the 126.700 level, the Forex pair may be ready to challenge high water marks not seen since February of 2019. Yes, the EUR/JPY is near important resistance, but if it is able to finally push through junctures which are standing in its way, the Forex pair may have a significant amount of room to traverse higher.
EUR/JPY Short-Term Outlook:
- Current Resistance: 126.600
- Current Support: 126.100
- High Target: 126.700
- Low Target: 125.800
