Nick Nasad
All posts from Nick Nasad
Nick Nasad in Nick Nasad,

EUR/JPY - Pair at Multi-Year Highs After Break of 133.70, Where to Next?

While USD crosses mainly consolidate following the sharp rallies overnight, the action seems to have moved to the JPY crosses.

  • Scanning the daily charts, the E/J jumps out at me because it has managed to push above its May high at 133.70.
  • The question of course now is, is this a break-out or a fake-out?
  • For me, breaching this important level is a bullish sign, and it should mean that the old high may turn to support when we have a retrace.
  • Looking back , the push through the downward sloping resistance trendline and then retesting it as support was a great clue.

  • I had to zoom out to the weekly to get a next medium term target to the upside, which comes in around 138.30 and where the highs set in late 2009.
  • With the pair breaking a 4-month consolidation, I believe we can have further upside potential, and a 450 pip move over the next few weeks is not out of the question.
  • Of course, we'll have to monitor exactly what happens if we do come back and retest the previous high in the short-term and work from there, buts its always good to get context from the longer-term charts. 

- Nick