Even with no major economics, JPY trimmed heavy gains during last week as improvements in UK PMIs and US NFP cleared sizeable uncertainties regarding future actions of Fed & BoE. However, the political stand-off between the Greece and the EU relating to austerity measures coupled with the on-going cliff between Russia and the Ukraine continue supporting the safe haven demand of the Japanese currency and strengthened the JPY during Monday. Market players are expected to closely examine the details of Greece talks, scheduled for Wednesday, together with the Russian comments for the western world, also on Wednesday, in order to determine near-term JPY moves.
Given the backdrop, the following is a brief technical overview of USDJPY, EURJPY, GBPJPY and AUDJPY.
Even if the USDJPY pulled back itself from the 117 – 116.90 support-zone, two month old descending trend-line, near psychological resistance 119, plays an important role in determining near-term moves of the pair. Should it successfully break the same trend-line and closes above 119.30, it can immediately extend its up-move towards 120.80 before testing the 2014 highs near 121.80. Moreover, a break of 121.80 could further fuel the pair’s rally towards 61.8% FE of its October – December 2014 up-move, near 123.20. On the downside, 50-day SMA, near 118.70 at present and the 118 support level, are likely immediate rests for the pair before it tests the 117 – 116.90 support zone. Given the pair’s ability to break 116.90 on closing basis, it can test 116.10 and the 50% Fibo. near 115.50, before plunging to the psychological support level of 114, also encompassing 61.8% Fibo. level.
Oversold RSI fetched the pair back from its 130 support level; however, 135.40 – 135.50 horizontal resistance-zone continue to restrict EURJPY up-move. Moreover, with the negatively slanting RSI, the pair is likely to re-test its 132.40 horizontal support in near-term. Also, a break below 132.40 can become detrimental for the pair’s up-move and can recall the January lows near 130. On an extended decline below 130, the pair becomes vulnerable to test August 2013 lows near 127.80. Alternatively, a break of 135.50 can fuel the pair’s rally towards 136.50 before testing the 38.2% Fibonacci Retracement of its December 2014 – January 2015 decline, near 137.60. Given the JPY weakens further and the pair closes above 137.60, the 200-day SMA, near 139.60 at present, immediately followed by the psychological resistance and the 50% Fibo of 140, provides strong resistance to the pair’s near-term up-move.
Also Watch: Weekly Overview of major currency pairs
With the recent leap into the pair prices, the horizontal support turned resistance, at 181, comes again into play and a possible break of the same can be expected considering the GBP strength and a steady rise of RSI. Should it closes above 181, the pair can immediately rally towards 182.30 before testing the 23.6% Fibonacci Retracement of its October – December 2014 up-move, near 184.50, with 183.30 could provide intermediate resistance to the pair. Given the pair becomes unable to close above 181, 100-day SMA, near 180.30 is likely immediate support for the pair, breaking which 178.80 – 178.75, encompassing 50% Fibo, is likely support before the pair falls to 61.8% Fibo. near 176.30 support.
AUDJPY’s reversal from 89.30 support level triggered the pair’s up-move towards 93 horizontal resistance; however, the overbought RSI and the AUD weakness are likely to reasons that can cause the pair to re-test 91.50 and 90.60 support level before extending its decline towards 89.30. Moreover, continued selling pressure below 89.30 can provide considerable weakness to the pair and can make it test 88.20 support level. If the pair closes above 93, it can rally towards 94 and the 38.2% Fibonacci Retracement of its November – 2014 to February – 2015 decline, near 94.50, quickly followed by the descending trend-line resistance, near the psychological resistance level of 95. A close above descending trend-line becomes decisive for the AUDJPY up-move and can support the pair to test 97 mark, with 96 being intermediate resistance level.
Follow me on twitter to discuss latest markets events @Fx_Anil
At any use of the analytical material taken from the site of company Admiral Markets, and the secondary publication on any other resources, the rights to intellectual property for a dealing center «Admiral Markets», the reference to the company site is obligatory.