Is it possible to see a price compression on EurJpy. In fact the price is moving within the channel between the static support identified by 61.8% of the Fibonacci retracement (placed at 120.05) and between the static resistance identified by 50% of the Fibonacci retracement.
Technically, so far, this pair is set downwards. This on short/medium term time frames. With the violation of the EMA 20 daily periods, the price appears to be destined to reach the support area. The one just mentioned. An intermediate target is the support of minor importance located at 120.85. On both daily, weekly and monthly time frames, there was a cross-over of the main EMAs (or 200 perodi with 20). This means that sales on the European currency have not ended. Investors are preferring to move capital to the Japanese currency.
This decline is also fundamentally justified. This because although the ultra-expansive monetary policy of the BOJ is already known and has not been changed for a long time. The ECB, according to Draghi’s words and the macroeconomic data of the Eurozone, will also tend to be in the coming months more expansive than she already is. Causing a devaluation of the euro.
Because the price compression on EurJpy we advise to position yourself short on this pair. The target area could be around 120. While the two intermediate TPs are fixed in the areas set at 120.85 and 120.40.
Follow us on TradingView