EUR/JPY jumps above 61.8% of Brexit drop

Offered tone around the Japanese Yen strengthened again in Asia, pushing the EUR/JPY cross above 171.11 (61.8% of Fibo retracement of Brexit drop).

Bullish engulfing candle on weekly

Four day winning streak seen this week has led to a bullish engulfing candle stick formation on the weekly time frame. Major part of the gains has been driven by increased hopes of Japanese fiscal stimulus. The offered tone around JPY refuses to weaken despite falling propsects of helicopter money.

EUR/USD pair remained stuck below 200-DMA in the first three trading sessions of the week, before breaking above the same on Thursday. Still, the Euro is having a tough time extending gains above 1.11. Consequently, it is the USD/JPY which is doing the heavy duty of lifting the EUR/JPY cross.

EUR/JPY Technical Levels

The immediate resistance is seen at 118.00 (zero figure), above which the cross could target 118.35 (weekly 10-MA. Further rally could run into resistance at 119.18 (50-DMA). On the other hand, a breakdown of support at 117.11 (61.8% of Fibo retracement of Brexit drop) could yield 116.42 (July 12 high), under which losses could be extended to 115.60 (50% of Fibo retracement of Brexit drop).