EUR/JPY long-term technical analysis
Eurozone situation and Japan situation has not changed as both central banks maintain the view to hold interest-rate unchanged. The development of trade war caused by the U.S took the worse path and roiled the market. Uncertainties continue mounting in the market and it is hard for traders to stay in risky assets.
Japanese yen gained across the global market as traders flight to safe-haven assets. There will not be any change to the situation soon due to the unforeseeable future. Traders could continue to stick to the short side of EUR/JPY while monitoring major change in central banks decisions.
Click here to see previous EUR/JPY long-term technical analysis May 2019
EUR/USD suffers a setback in May as the pair rejected from 125.00 and fell below 121.50. This month, the pair attempting to recover part of its losses but rejected from 123.10 resistance. If the pair closes below 121.50 at the end of the month then we could expect further weakness in the coming months.
EUR/JPY managed to bounce from the bottom of the channel perfectly. There was follow-through by the bull but the bullish reaction rejected from 123.10 resistance. The pair currently testing 121.50 and looking to close above it. If no breakout happens then EUR/JPY might continue inside 121.50 – 123.10 until breakout happen.
EUR/JPY daily chart has the same situation as the situation in the monthly chart. The pair currently testing 121.50 support level. Traders will monitor the pair reaction near the support before deciding the next direction.
Long positions will need to wait for the reaction at 121.50. If the bull could maintain the level above it then it is possible a bounce will happen.
Short positions are best taken near 123.10. Another alternative is short when retest on 121.50 after breakout happens.