Karen Jones, Team Head FICC Technical Analysis at Commerzbank, suggested the cross needs to surpass the 120.55/72 band in order to regain upside pressure.
“EUR/JPY is on the defensive but with a second 13 count and TD support at 116.36 we are cautious of blindly following this lower. Initial resistance is the 20 day ma at 118.55 and the 120.06 25th July low. Key short term resistance is the 55 day ma and the 3 month downtrend at 120.55/72. The market will need to regain this on a closing basis to reassert upside interest”.
“TD support at 116.36 guards the 114.86 2017 low. The break lower last week saw the market erode a 2012-2019 support line and this leaves a negative bias entrenched while below the downtrend”.
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