Forex Marketz Daily Forex News – Fully Markets Update
The EUR/JPY Forex market launched higher after the Bank of Japan (BOJ) launched a new round of Quantitative Easing (QE) into their markets. This form of QE came as negative interest rates, a first for the BOJ. Right now, this Forex market is near a major trend line which, if breached on a daily basis, would be quite bullish for the euro.
Technical Analysis
Let’s talk about today’s EUR/JPY technical analysis. Right now there is an overall neutral tone in this Forex market. The gap higher after the BOJ announcement sent the euro into a key resistance area that starts at the multi-month falling trend line. This area runs from 131.68 towards the technical barrier at 132.03. A daily close above the latter barrier challenges the next significant upside barrier at 132.50. There are several other resistance barriers within this area like 131.80 and 132.03 to consider as well.
Trade Strategy
A lot going on in the EUR/JPY Forex market as I consider today’s daily trade strategy. From a technical perspective, the risk to reward analysis says that current price action is narrow and too close to a key technical resistance level to warrant a long euro trade. This means I will stand aside for now. However, aggressive traders can place a stop at 132.50. These traders should employ wedge stops form Friday’s high at 131.27 towards 132.50 for short positions. There is only around 70 pips risks doing that. This move could see a first target at the key level of 130. Levels below that are 128.50 then the next key downside barrier at 126.15.
