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EUR/JPY Technical Strategy: Flat
Support: 136.38 135.70 134.85
Resistance:138.02 138.79 139.74
The Euro advanced for a third consecutive day against the Japanese Yen to challenge a pivotal chart resistance point. A daily close above the intersection of the August 1 high and a falling channel top at 138.02 exposes the 38.2% Fibonacci retracement at 138.79. Alternatively a reversal below horizontal pivot support at 136.38 opens the door for a challenge of the September 8 low at 135.70.
Risk/reward considerations argue against entering long with prices sitting at resistance. On the other hand the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0
-- Written by Ilya Spivak Currency Strategist for DailyFX.com