Forex Weekly Watch: Nov. 10 – 14, 2014

EUR/JPY

EUR/JPY 1 Hour Forex Chart

EUR/JPY 1 Hour Forex Chart

The yen fire sale continued last week among the crosses, but in a much more subdued manner than when the BOJ hit us with the surprise increase in monetary policy stimulus a couple of weeks ago.  From Tuesday on, it was sideways action for EUR/JPY, which changes the technical picture for me a little bit.

With the tight range last week–but the uptrend still in tact– a break out of previous week highs (PWH) could draw in longer term momentum players looking for an upside opportunity.  The area between the 200 moving average and bottom WATR level may also draw in buyers who like to buy on pullbacks to leg in at a better price.

  • WO: 142.76
  • Top WATR: 143.85
  • Bottom WATR: 141.68
  • PWH: 144.21
  • PWL: 140.40

GBP/JPY

GBP/JPY 1 Hour Forex Chart

GBP/JPY 1 Hour Forex Chart

Because of the strong interest in the Japanese yen over the past couple of weeks, Guppy’s price action looks nearly the same as EUR/JPY, creating the same potential support opportunity at the PWL, WATR, and 200 moving average on a pullback.  Momentum plays are also fair game as forex traders may step in on a strong upside break of the PWL.

Of course, with consolidation patterns, there is a possibility of a downside break, and with yen pairs, this is especially the case during periods of broad risk aversion behavior. I think if the PWL, WATR, and 200 MA breaks this week, I’ll have to take a serious look at shorting the pair, especially if the major economic events from the U.K. economic calendar warrant a weak Sterling bias.

  • WO: 181.70
  • Top WATR: 183.33
  • Bottom WATR: 180.07
  • PWH: 184.32
  • PWL: 179.66

EUR/GBP

EUR/GBP 1 Hour Forex Chart

EUR/GBP 1 Hour Forex Chart

The price action in EUR/GBP still favors downside moves, especially with strong resistance at the moving averages and broken previous support at this week’s PWH. Sellers may consider laying some short plays out all the way up to the top WATR area, which did hold as resistance two weeks ago.  And because it’s been a strong downtrend for quite some time, a break of the PWL does have a good chance of drawing in more sell orders to push the pair to the next potential support level around .7765 (September lows).

  • WO: .7855
  • Top WATR: .7901
  • Bottom WATR: .7810
  • PWH: .7864
  • PWL: .7799

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