Dukascopy Bank Team
Dukascopy Bank SA
EUR/JPY 1H Chart: Channel Down
Comment: After a massive 400-pip rally a week ago EUR/JPY entered a bearish channel. Accordingly, the latest recovery of the Euro from 132.70 should soon come to an end, namely at the upper boundary of the pattern at 133.85.
However, as long as support at 132.70 remains intact, our outlook will be neutral, being that this demand level consists not only of the lower trend-line of the channel, but is also reinforced by the weekly PP and 200-hour SMA. At the same time, the technical indicators are mixed, and the SWFX market participants are undecided—the numbers of long and short positions are equal. Below this cluster the price will likely target November low at 129.70.
USD/TRY 1H Chart: Channel Up
Comment: USD/TRY has been bullish since the beginning of December, but soon there is going to be a serious test of the current upward momentum. In order to confirm its intentions to move higher, the currency pair will have to breach a solid resistance area at 2.9370/40, created by the weekly R1 and November high. Soon thereafter the US Dollar will be expected to begin a bearish correction from the upper trend-line of the channel, but in the longer term there will be a high chance of the rate probing the October 13 high at 2.9660. In the meantime, a close beneath 2.92 will imply a sell-of down to 2.90, where the weekly PP merges with the December 9 low and 200-hour SMA.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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