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EUR/JPY Technical Strategy: Flat
Support: 136.53 135.80 135.16
Resistance: 136.84 137.67 138.51
The Euro advanced as expected against the Japanese Yen after prices produced a bullish Piercing Line candlestick pattern. A daily close above the 38.2% Fibonacci retracement at 136.84 exposes the 50% level at 137.67. Alternatively a reversal below channel top resistance-turned-support at 136.53 opens the door for a challenge of the 23.6% Fib at 135.80.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand the absence of a defined bearish reversal signal suggests taking up the short side is premature. With that in mind 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