EUR/JPY technicals signal some caution – Commerzbank

The perspective around EUR/JPY stays cautious for the time being, noted Karen Jones, Head of FICC Technical Analysis at Commerzbank.

Key Quotes

“EUR/JPY has sold off to and so far held over the 5 month uptrend at 131.66. Provided that the uptrend contains the down side, the longer term up move will remain intact and re-challenge the 134.32 Fibo (61.8% of the move down from 2014. However it should be noted that the intraday Elliott wave counts are now negative and suggesting that the trend line will not hold, so caution is warranted and we would keep stops tight. Above 134.32/58 would target the 1979-2017 resistance line at 139.12”.

“A move below the 55 day moving average is needed to alleviate upside pressure and retarget the 129.37 September low and the 127.57 August low”.