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EUR/JPY Technical Analysis: I Want to Move Like Stocks
10/17/2014 9:00 am EST
Greg Michalowski of ForexLive.com charts a currency pair that seemed to have been somewhat attached to the ups and downs in equities on Thursday. Greg also points out what currency traders should be on the lookout for next.
I want to move like stocks. I want to move like stocks. I want to moooooooove like stocks do…
The stock market started to rebound and so did the price of the EUR/JPY.
The pair was somewhat attached to the ups and downs in equities on Thursday. There has been a failed break above the 100 hour MA (blue line) in the Asian session and just before NY traders entered for the day, there was a break below the bottom side trendline. That move quickly failed.
The last push higher stalled at the 100 hour MA. It seems to be a level to eye. A level to get—and stay above now—if the buyers are to start to take back more control.
When a currency pair starts to be so tied to another market, technicals can get distorted as focus ironically moves to trading the EUR/JPY off of the S&P chart (why not just go trade the S&P?). However, as the chart below shows, failures can give bias change clues as well (it might be a better trade strategy in these choppy markets). Sometimes the levels also hold, like we are seeing now in the EUR/JPY.
Risk (market, event, and liquidity) may not be as high as on Wednesday, but it still is in the market so be more cautious, traders are driving in a snow storm still.
On a break above (i.e. a continued push higher in the stock market), the 136.02 is the next target. For those interested in selling, the broken trendline at 135.39 held the correction, so far. So getting below this level will be eyed.
EUR/JPY following the stocks
Click to Enlarge
By Greg Michalowski of ForexLive.com
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