Technical Update – JPY Pairs

USDJPY

After failing to capitalise on the strong momentum that lifted the pair to a 13-year high in early June, the pair on Wednesday dropped below 100-day SMA support near 121.00 mark. The pair, however, has managed to hold an ascending trend-line support, extending since the beginning of 2015 through lows tested in April and May 2015, to move back above 121.00 mark. Should the pair continue with its bounce from the trend-line support and sustain its strength above 121.50 level, it seems to aim back towards a horizontal resistance near 122.50-60 zone. Strength above 122.50-60 area now seems to face strong resistance near 123.00 mark, representing a short-term descending trend-line support visible on daily chart. Meanwhile, weakness below 100-day SMA might continue finding support at the ascending trend-line support, currently near 120.30-20 region, which if broken might trigger additional weakness in the near-term towards testing its next major support near 118.50-40 area, also coinciding with 200-day SMA.

EURJPY

Reversal from 61.8% Fib. retracement level of the pair’s sharp fall from Dec. 2014 highs to April 2015 lows dragged the pair back towards testing 100-day SMA support. Although the pair seems to have held 100-day SMA support, any further pull-back now seems to confront a strong resistance near 135.00 mark, comprising of 38.2% Fib. retracement level and a short-term descending trend-line. However, a decisive strength above this strong resistance seems to boost the pair immediately towards testing its next major resistance near 137.00 horizontal zone. Alternatively, weakness below 100-day SMA, currently near 133.50 level, opens room for continuing the pair’s weakening trend towards testing sub-132.00 mark support, representing 23.6% Fib. retracement level near 131.70 region.The downfall could further get extended towards its next horizontal support near 129.00 round figure mark.

CADJPY

Following a weakness below 200-day SMA support and a subsequent drop below a short-term ascending trend-line support, the pair dropped to test a very important support 94.50-40 area. The pair is currently witnessing a pull-back from that important support and seems to approach its immediate horizontal resistance near 96.20-30 zone. A move above this immediate resistance is likely to be restricted at the ascending trend-line support break-point, now turned resistance near 96.75-80 level. Decisive strength above 96.75-80 resistance, seems to provide the required momentum for the pair to reclaim 98.00 mark and re-test 200-day SMA resistance, currently near 98.40-45 area. However, should the pair fail to sustain the current pull-back and drop back below 95.00 mark, it could then be headed lower, even below the very important support near 94.50-40 zone, towards testing its next major downside support near 93.00 region.

CHFJPY

On Wednesday, the pair decisively broke below 129.00 level, marking 38.2% Fib. retracement level of its March-June up-move, and subsequently dropped to test a very important support confluence near 127.20-40 region, comprising of 50% Fib. retracement level and 100-day SMA. Moreover, the pair also decisively weakened below an ascending trend-line support, extending through March-April 2015 lows. Hence, the 128.50 important support break-point now seems to have turned as immediate resistance for the pair. However, a decisive break through 128.50 resistance, leading to a extension of the upward momentum beyond 129.00 mark, has the potential to further lift the pair back towards testing its next strong resistance near 131.00-20 zone, also coinciding with 23.6% Fib. retracement level. Meanwhile, a decisive weakness below 127.20-40 support confluence now seems to open room for additional near-term weakness towards testing 61.8% Fib. retracement level support near 125.50 level.

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