Yen traders are about to get busy with not one, but TWO yen setups on today’s canvas.
Which one looks promising to you?
EUR/JPY took on a lot of selling pressure just before hitting the 128.50 mark earlier this week.
Can the bears keep up their game? The euro is sitting on a 38.2% Fib retracement that’s right smack at a mid-channel support AND a previous resistance on the 1-hour time frame.Market bulls who would love to get back on the more obvious uptrend can wait for some momentum around the current levels before targeting February’s highs.
Think the euro will see some more selling before the bulls attack? You can also keep an eye out for a possible test of the 50% or 61.8% Fib levels closer to the channel support and the SMAs for a better reward-to-risk ratio on an uptrend trade.
If countertrend trading is more your thing, however, then you can also jump in on the bearish party and then bail as soon as you see the lower support levels holding.
Looks like the dollar bulls have been busy this year!
Not only have they pushed USD/JPY above a trend line that had held solid for most of 2020, but they’ve also thundered past the 100 AND the 200 SMAs on the daily chart.The 106.00 psychological handle is the next big barrier as it has served as a key inflection point back in 2020.
Judging by the uber bullish candlesticks, though, I’m thinkin’ the dollar bulls still have enough firepower for more upside action.
You can buy at current levels or even a retest of the 200 SMA if you believe that USD/JPY will hit 108.00 or even the big 110.00 some time in the next couple of weeks.
Meanwhile, trend warriors can wait for signs that the 200 SMA would hold after all and then start to load them short positions as soon as USD/JPY drops below the broken trend line.