The EUR/JPY has dropped aggressively in the previous week, but has found strong support and now looks motivated to recover after the impressive drop. Has increased significantly in the start of this week and now is approaching some important resistance levels, remains to see how will react when will touch these levels.
The minor rebound was somehow expected after the last week’s sell-off, the Yen has also lost ground versus the Cable and versus the dollar, not only against the Euro as the Nikkei stock index has found strong support and now is struggling to increase.
The JP225 has increased and is trying to erase the yesterday’s losses, the index remains under selling pressure, despite a minor bounce back, technically is expected to drop much more in the upcoming period, so the Yen could increase further if the Nikkie will slide further.
The Euro has increased versus the Yen only because the Nikkei has increased, the Euro-zone data have come in mixed today, the EUR/JPY rebound could be only temporary if will be rejected by the near term resistance levels.
Price has increased and is very close to hit the median line (ml) of the minor descending pitchfork, where he could find resistance again, could climb also the retest the upper median line (UML) of the major descending pitchfork, could drop again if these levels will hold.
A rejection from the mentioned resistance levels will send the price much below the 114.84 previous low, however, a larger rebound could exist if will have enough energy to take out the mentioned dynamic resistance levels.
The current bounce back is natural after the failure to reach the lower median line (lml) of the minor descending pitchfork and after the failure to close right on the lower median line (lml) of the ascending pitchfork. A larger drop will come only if the rate will escape from the ascending pitchfork’s body, will register a significant drop if will remain trapped below the upper median line (UML) of the major descending pitchfork, could attracted by the median line (ML) in the upcoming weeks.