25 Sep 2013
EUR/JPY struggles to hold 133.00
FXstreet.com (Athens)- The EUR/JPY is struggling to hold the 133.00 key level support, the Japanese currency is outperforming across the board.
EUR/JPY loses steam as the Japanese currency outperforms on "carry unwind"
The EUR/JPY was trading upwards since the mid-European trading session and especially after the up beating release regarding the Italian Consumer Confidence (101.1 for September versus a forecast of 98.5 and 98.4 in August). Since then, the pair has lost its uptrend stream and moves sharply downwards threatening the 133.00 Key support area. This might well be attributed to the Japanese currency which is outperforming across the board. Also, generally there are many haven flows as stocks fall and the Japanese currency is both taking advantage as the absolute “safe-haven” currency as well as due to carry unwind. Traders should take into deep consideration that the yen is the only currency on the majors that has managed to outperform the greenback last week. Since higher inflation and improving confidence coinciding with a government commitment to tackle fiscal problems should all play into “Abenomics” and help encourage some renewed yen selling, thus dragging the pair down.
Technical Outlook on EUR/JPY
Karen Jones, Head Technical Analyst at Commerzbank suggests that the “continues to consolidate recent gains. The intraday chart suggests that it should base at circa 132.42. Last week we saw the
market climb into new highs for the year and the market also eroded the 2010 peak at 134.37. We look for further gains this week to major resistance at 137.42/139.26 where the April, May, August and October 2009 highs were all made. The triangle measures up to 141.05.”
EUR/JPY loses steam as the Japanese currency outperforms on "carry unwind"
The EUR/JPY was trading upwards since the mid-European trading session and especially after the up beating release regarding the Italian Consumer Confidence (101.1 for September versus a forecast of 98.5 and 98.4 in August). Since then, the pair has lost its uptrend stream and moves sharply downwards threatening the 133.00 Key support area. This might well be attributed to the Japanese currency which is outperforming across the board. Also, generally there are many haven flows as stocks fall and the Japanese currency is both taking advantage as the absolute “safe-haven” currency as well as due to carry unwind. Traders should take into deep consideration that the yen is the only currency on the majors that has managed to outperform the greenback last week. Since higher inflation and improving confidence coinciding with a government commitment to tackle fiscal problems should all play into “Abenomics” and help encourage some renewed yen selling, thus dragging the pair down.
Technical Outlook on EUR/JPY
Karen Jones, Head Technical Analyst at Commerzbank suggests that the “continues to consolidate recent gains. The intraday chart suggests that it should base at circa 132.42. Last week we saw the
market climb into new highs for the year and the market also eroded the 2010 peak at 134.37. We look for further gains this week to major resistance at 137.42/139.26 where the April, May, August and October 2009 highs were all made. The triangle measures up to 141.05.”