A re-established wave of risk aversion enveloped the global markets during trading on Tuesday following the attacks in Brussels which consequently boosted appetite for the safe-haven Japanese Yen. The Yen appreciation triggered a sharp selloff in the EURJPY which sunk below the psychological 125.00 support potentially opening gates toward 123.00. This pair is turning increasingly bearish on the daily timeframe as prices are trading below the 50 SMA while the MACD trades to the downside. Previous support at 125.00 may become a dynamic resistance which should encourage a steep decline towards 123.00 and potentially lower. A bullish move and daily close back above 127.00 signals bearish weakness and invalidates this daily bearish outlook.
Sentiment towards the Sterling remains firmly bearish and this risk-averse trading environment continues to leave the currency vulnerable to further losses in the near term. The GBPCAD currently follows a negative trajectory on a daily bearish channel while the fading expectations that the Bank of England will raise UK rates in 2016 have encouraged bearish investors to attack the pair further. Although some erratic candlesticks movements may be observed, prices are still bearish as there have been consistently lower lows and lower highs. The pair trades below the daily 20 SMA while the MACD also digs to the downside. A solid breakdown below 1.87 should encourage a further decline towards 1.85.
The CADJPY sunk towards 85.00 and may be poised to sink lower as risk aversion boosts appetite for the safe-haven Japanese Yen. This pair was already under pressure and a breakdown below 85.00 may open a path towards 82.00 and potentially lower. From a technical standpoint, prices are on the verge of trading below the daily 20 SMA while the MACD shows signs of weakness. A daily close below 85.00 may act as encouragement for bearish investors to attack with 82.00 looking like the first goal.
A combination of Kiwi weakness and Yen strength has left the NZDJPY under a lot of pressure with prices gearing for a potential decline back down towards 74.00. From a technical standpoint, prices are trading below both the 20 and 50 SMA while the MACD has crossed to the downside. Previous support at 76.50 may become a dynamic resistance which should encourage a steep decline towards 74.00 and potentially lower.
Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.