Forex Technical Update

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EUR/JPY 1H Chart 11/2/2012 3:35PM EDT

EUR/JPY 11/2/2012 1H chart

NFP reaction, range break: The EUR/JPY was trading near a recent range support heading into today’s (11/2) Non-Farm Payroll release. It came out 171K, beating forecast of 123K according to Forexfactory. The initial reaction reflected conventional risk-on dynamic, pushing the EUR/JPY near 103.80. However this rally proved unsustainable as the market faded the pair in the hour following the NFP release. Eventually as we wind down the week, EUR/JPY has broken this week’s range. Maybe the 103.00 psychological level can provide support, but if a pullback is prevented from pushing back above 103.50, the focus remains to the downside in the short-term

Bearish scenario: If the bearish outlook develops, a key level to break to extend further bearish outlook will be the 102.00 handle. A break below this ensures clearing below a rising trendline that started from July’s low of 94.10. It also breaks below the 200-day SMA and a recent support pivot made on Oct. 30. A break below 102 exposes that July low of 94.10, but first the support pivots of 100.15 and 99.55, between which we have the 100 psychological level. A conservative bearish outlook therefore, should be around 100.00, but first with break below 102 as confirming price action.

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.

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