Technical Update – JPY Pairs

EURJPY

On 4-hourly chart, the pair already seems to have confirmed a bearish Double-top chart pattern by decisively breaking below 139.00 mark support representing 23.6% Fib. retracement level of its up-swing from May low to highs touched in June. Hence, from current levels the pair seems more likely to resume its corrective move, initially towards retesting 138.40-30 intermediate horizontal support, before eventually dropping to 138.00 mark support representing 38.2% Fib. retracement level. Considering the confirmation of the bearish chart pattern, the pair might continue drifting lower in the near-term towards testing 50% Fib. retracement level support near 137.00 mark, which also coincides with the expected downfall of the Double-top chart pattern. Meanwhile on the upside, 139.50-60 horizontal area now seems to provide immediate resistance. Although a move above this immediate resistance might lift the pair back above 140.00 mark psychological resistance, but any up-move beyond 140.00 is likely to be restricted near 140.50-60 strong resistance area. A decisive move above 140.50 resistance might negate the near-term bearish outlook for the pair, thus boosting the pair beyond 141.00 mark strong resistance.

GBPJPY

The pair on Wednesday managed to rebound from sub-189.00 mark to move back above 191.00 mark, thus forming a short-term ascending trend-channel on 4-hourly chart. The formation of ascending channel suggests extension of the up-move towards the upper trend-line resistance of the channel, currently near 192.50-70 zone. The expected up-move is likely to materialize only once the pair manages to clear 191.40-50 immediate horizontal resistance. Alternatively, a sustained trade back below 191.00 mark now seems to drag the pair back towards testing the lower trend-line support of the ascending channel, currently near 189.10-189.00 mark. A decisive break below 189.00 mark now seems to trigger some near-term corrective move, initially towards 187.80-70 intermediate horizontal support and eventually towards a very important support near 186.20-186.00 area.

CADJPY

The pair’s recovery from lows tested in Jan. this year now seems to face a strong hurdle near 100.90-101.00 mark, representing 61.8% Fib. retracement level of Dec. 2014 to Jan. 2015 sharp fall. A decisive and sustained strength above this immediate strong resistance seems to immediately boost the pair towards 102.00-102.20 resistance area and the upward trajectory might get extended, even beyond 103.00 mark, towards 103.60-80 resistance area. Meanwhile, weakness below 100.00 psychological mark is likely to find immediate support near 99.50 level, marked by a short-term ascending trend-line. A decisive break below the short-term ascending trend-line might lead to an immediate drop towards 50% Fib. retracement level support near 99.00 mark and further towards the very important 200-day SMA support, currently near 98.30-20 area.

CHFJPY

After failing to sustain its strength above 134.00 mark, the pair on Wednesday dropped below 132.00 mark and on Thursday is just holding above 132.00 mark. From current level, a drop below 132.00 mark is likely to be supported by a previous resistance turned support near 131.30-10 zone, also coinciding with 23.6% Fib. retracement level of its March to June up-swing. Failure to hold this immediate support area, seems to open room for continuing the near-term weakness, initially towards 130.00 psychological mark support and eventually towards 38.2% Fib. retracement level support, near 129.00 mark. Meanwhile on the upside, 132.50 level seems to provide some immediate resistance. This is closely followed by a strong resistance near 132.80-133.00 area. A decisive move back above 133.00 mark now seems to provide the required momentum to help the pair surpass 134.50-60 resistance area and continue the near-term upward trajectory towards its next major resistance near 137.00 mark.

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