We start today with a setup that was covered over the weekend – EURJPY. The pair pushed through a major level today at 134.67, giving us reason to look lower.
Let me start by saying that this pair, like all Euro pairs, could see significant volatility on any news or rumors surrounding the drama in Greece. So be sure to take this into consideration when planning your trade.
EURJPY recently put in a major decline, losing nearly 2,000 pips in a matter of eight weeks. Starting in late January of this year, the pair began consolidating within a rising wedge pattern, which often results in a break to the downside.
Yesterday’s price action gave us that break on the back of uninspiring news out of Brussels regarding the Greek deal, or lack thereof. The pair managed a daily close below 134.67, which has acted as a key level since 2008. With this close, we can now begin looking for selling opportunities on a retest of 134.67 as new resistance.
Summary: Wait for a move back to the 134.67 area and then watch for bearish price action. Key support comes in at 133.60, 132.35 and the 2015 low of 130.13.