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Talking Points:
- EUR/JPY Technical Strategy: Flat
- Support: 140.00 (50% Fib ret.), 139.11 (61.8% Fib ret.)
- Resistance: 140.89 (38.2% Fib ret.), 141.37 (rising trend line)
The Euro is facing renewed selling pressure after a brief correction higher, dropping to support at 140.00 against the Japanese Yen. This psychological barrier is reinforced by the 50% Fibonacci retracement. A break downward on a daily closing basis initially exposes the 61.8% level at 139.11. Alternatively, a reversal above the 38.2% Fib at 140.89 clears the way for a retest of the trend line, now at 141.37.
Prices are too close to relevant support to justify a short position at current levels from a risk/reward perspective. We will stand aside for now, looking for a break downward or a corrective bounce to yield a selling opportunity.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com