62% Fib Retrace. Both Support & Trendline broken with quite a bit of volatility each way and no continuation in either direction. If support holds, will be looking for longs with VIX and Equity markets confirming the move for a weaker JPY.
If stars align, risk aversion should continue supporting a potential short in the equity markets along with a weaker USDJPY, and stronger USD across the other majors. While I'm not taking a short just yet, this is just a setup that I will be monitoring over the next few weeks. Fundamentally, there aren't many reasons for equity bulls to keep pressing higher highs,...
Brexit is just the start of the euro area problems. I think more countries will soon follow and that leads me to believe that the long term outcome will be for the euro to depreciate. However, short-medium term there could be some positive news that push the euro higher, even if its driven by a weaker USD. Right now the trend is for the euro to move higher, lower...
The euro has tumbled over the last few years as problems in the EZ persist. I wrote an article in December 2011 about the EZ problems in FX Trader Magazine and while I thought the euromageddon would occur within months, the political will of keeping the experiment alive has pushed that window out. Now, 6 years later, with the EURUSD trading almost 30% lower,...
3/22 Update:
Failed breakout higher led to a reversal as risk-off took control of the markets yesterday. Continuation is very likely in equities today as well as a stronger yen (risk aversion). Entries between 138.60 and 139.00. The trend has been broken so this should lead to some strong selling pressure.
The breakout didn't have much momentum and any longs should have a firm stop between 138.90 if not near the 139.15; if the lows are taken out, then we will look forward to continuation lower. Risk-off today is helping the Yen gain ground. USDJPY looks weak so the long trade is very risky at this point. Neutral.
The breakout didn't have much momentum and any longs should have a firm stop between 138.90 if not near the 139.15; if the lows are taken out, then we will look forward to continuation lower. Risk-off today is helping the Yen gain ground. USDJPY looks weak so the long trade is very risky at this point. Neutral.
3/21 Update:
Price bounced off support at 139 and is now higher than the previous 4h pivot high and almost breakout out of the descending triangle. A break above 140.50 signals a buy opportunity with stops below 140 and 139.00;
Alternatively, a break below 138.90 issues a very big sell signal. Traders will view the lack of momentum higher as very bearish.
Waiting for a breakout either below the 138.70 level or above 140.70. From current price action analysis, looks like the lows are going to be tested. Unless we see a false breakout, 50% fib at 136.75 is first target followed by support at 134.00
