15 Nov 2013
EUR/JPY in midst of what appears to be a powerful third wave higher; upside target 137.90?
FXstreet.com (Barcelona) - The EUR/JPY is seemingly on cruise control on the upside right now. The “risk-on” trade is in full effect and is forcing investors to move money out of the Yen and into stocks.
EUR/JPY being used as a tool for managers to keep pace with the benchmark indices
Active managers have been struggling all year to keep up with the equity indices – and it’s getting fairly late in the year. So, the under-performing crowd has a choice to make – buy the over-valued go-go stocks with liquidity limited to equity market trading hours or go long currency risk proxies like EUR/JPY that you can exit much more efficiently if necessary. To anyone reading this article on this website, the choice to be made is obvious. Based on the recent trading action in EUR/JPY that obvious choice is being made by big money around the globe.
Friday, the EUR/JPY may be influenced by multiple European data points including: EuroZone CPI; and, the EcoFin meeting for the EU.
Technical outlook for EUR/JPY
Technicians say the EUR/JPY could still be in the midst of a corrective bounce that could lead to yet another short-term wave lower – but the higher probability exists in the more bullish scenario where an upside breakout is about to take place above the recent 135.50 high. Once that breakout occurs, a shot up to the Fibonacci projection line at 137.90 is likely to occur. Support comes in at Wednesday’s low at 133.22 and is backed up by 131.13 – the 10/8 low that was recently re-tested.
EUR/JPY being used as a tool for managers to keep pace with the benchmark indices
Active managers have been struggling all year to keep up with the equity indices – and it’s getting fairly late in the year. So, the under-performing crowd has a choice to make – buy the over-valued go-go stocks with liquidity limited to equity market trading hours or go long currency risk proxies like EUR/JPY that you can exit much more efficiently if necessary. To anyone reading this article on this website, the choice to be made is obvious. Based on the recent trading action in EUR/JPY that obvious choice is being made by big money around the globe.
Friday, the EUR/JPY may be influenced by multiple European data points including: EuroZone CPI; and, the EcoFin meeting for the EU.
Technical outlook for EUR/JPY
Technicians say the EUR/JPY could still be in the midst of a corrective bounce that could lead to yet another short-term wave lower – but the higher probability exists in the more bullish scenario where an upside breakout is about to take place above the recent 135.50 high. Once that breakout occurs, a shot up to the Fibonacci projection line at 137.90 is likely to occur. Support comes in at Wednesday’s low at 133.22 and is backed up by 131.13 – the 10/8 low that was recently re-tested.