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Talking Points:
- EUR/JPY Technical Strategy: Short at 137.12
- Support: 136.09-22, 134.91-135.23, 133.96
- Resistance:137.39, 138.02-30, 138.80
The Euro moved lower as expected against the Japanese Yen after prices put in a Bearish Engulfing candlestick pattern. A daily close below the 136.09-22 area marked by the 23.6%Fibonacci expansion and the February 4 low exposes a falling channel floor at 135.20, followed by the 38.2% level at 134.91. Alternatively, a turn above 137.48, a rising trend line support-turned-resistance set from early August, opens the door for a challenge of the August 1 high at 138.00 and the channel top at 138.30.
We sold EURJPY at 137.12, initially targeting 136.22. A stop-loss has been set to activate on a daily close above 138.02. We will take profit on half of the trade and move the stop-loss breakeven once the first objective is met.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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