The People's Bank of China has slashed reserve requirements, leading the yuan lower as the trade war threats with the Trump administration continue to intensify.
Day trade
Trade view / 24 May 2016 at 7:23 GMT

EURJPY downside still in focus despite rallies

Analyst / PIA First
United Kingdom
Instrument: EURJPY
Price target:
Market price:

EURJPY – The long-term bias is still focused on the downside with this month’s rally rejected close to April's Marabuzo at 124.90. An AB=CD formation is seen at 117.35. Fibonacci confluence area is at 115.36-114.08.

Monthly - Fibonacci confluence area

Source: Saxo Bank. Create your own charts with SaxoTrader click here to learn more

The daily chart highlights mixed results for the last eight trading days. This has resulted in a channel formation on the intraday chart. The base of this formation is at 122.00 making risk/reward poor to call a sell from current levels. Our bespoke system still highlights a bear trend with selling into rallies the call today.

Daily - Mixed Results
 Source: Saxo Bank 

Our resistance levels are 123.15 and 123.25. With 123.18 being the top of yesterday morning’s Value Area (Market Profile), we choose this level to get short.

It should also be noted that with USDJPY reaching an intraday 261.8% extension and bespoke support at 109.13, we are also selling into rallies in this pair today (ample scope for a move to 109.85).

Two Hour - Bearish Channel
 Source: Saxo Bank

Management and risk description


Entry: Selling at 123.15

Stop: 123.55

Target: 122.00

Time horizon: today only

— Edited by Clare MacCarthy

Non-independent investment research disclaimer applies. Read more
vyacheslav111 vyacheslav111
Hi ! Your opinion on EURJPY now?
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
not an easy one.... in a corrective channel with a base at 121.80. We are trying to sell rallies at 122.86 today .... focusing on that support (selling rallies USDJPY is the preferred trade)
vyacheslav111 vyacheslav111


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