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Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 143.79, 141.95, 140.10
- Resistance:146.08, 148.78, 149.78
The Euro is reversed lower against the Japanese Yen as expected after prices put in a bearish Dark Cloud Cover candlestick pattern. A daily close below the 38.2% Fibonacci expansion at 143.79 exposes the 50% level at 141.95. Alternatively, a reversal above the 23.6% Fib at 146.08 opens the door for a test of trend line support-turned-resistance at 148.78.
Entering short is tempting but we will tactically opt to stand aside, waiting for the upcoming FOMC policy announcement to pass before committing to a directional bias. The outcome may spell volatility for sentiment-sensitive Yen-based currency pairs, threatening to derail follow-through on technical positioning.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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