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Daily Market Report – EUR/JPY Is This A Brearish Signal? October 18, 2017

By Mexgroup.com

EUR/JPY Edged Higher

The EUR/JPY increased sharply today and erased the yesterday’s losses. Price is strongly bullish right now, but this rebound could be only temporary and the rate could turn to the downside again. The pair reached a strong confluence area, so we may have a trading opportunity very soon. Technically, it was somehow expected to drop further on the short term, but we still need a confirmation.

We’ll see what will happen because the Yen is punished by the Nikkei’s rally, the index climb further and reached the 21427 high. A further increase will force the Yen to depreciate versus all its rivals. EUR/JPY increased only because the JP225 has extended the upside momentum.

We’ll see how long Nikkie’s upside movement will be because we may have a minor retreat after the impressive rally. The USD X is pressuring the 93.81 static resistance and seems a little exhausted, a USDX’s drop will signal a Nikkei’s drop as well.

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EUR/JPY is testing the confluence area formed between the outside sliding line (SL) with the downside line of the Rising Wedge pattern, a rejection will signal a drop at least till the upper median line (UML) of the major red ascending pitchfork. However, a valid breakout above the confluence area will accelerate the bullish momentum.

NZD/USD Turned To The Downside

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The NZD/USD dropped sharply after the yesterday’s false breakout above the 50% Fibonacci level and could approach the 61.8% retracement level. Price failed to reach the upper median line (uml) of the descending pitchfork, so the current drop is natural. Could drop much deeper after the retest of the wl5 and after the failure to close near this line, it could come to retest the median line (ml) of the descending pitchfork.

AUD/USD Break Or Bounce?

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Price dropped further, but has found temporary support at the 38.2% retracement level and now has squeezed a little. Technically, it could drop to retest the median line (ml) of the minor descending pitchfork before will make a crucial decision. Is somehow expected to drop further after the failure to approach and reach the 23.6% retracement level and the LML. It could be attracted by the confluence area formed at the intersection between the median line (ml) with the WL1.

By Olimpiu Tuns – Market Analyst

Profil1

I graduated a Master in Business Administration, I am a Market Analyst / Trader on Financial Markets (forex, commodities, futures, options) for more than 6 years, I use technical and fundamental analysis for my daily activity. Founder and Market Analyst at ovtbusiness.com (Financial Markets Blog) and contributor on investing.com, actionforex.com,  countingpips.com, forexalchemy.com, etc.

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About Louie Lewis

Louie Lewis
Successful forex trading starts with you first. Then comes the actual strategies and techniques. I have been involved with forex and forex trading for a few years now. It is a wonderful way to build wealth. The learning never stops and I want to help others along their journey into this wonderful market of opportunity.

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