Chart of the Day EURJPY
EURJPY Potential Reversal Zone - Probable Price Path
U.S. stocks remain supported for now, supporting the performance of a variety of risk currencies. The US dollar index closed down 0.5% to a low of 96.9 in the past month, and the 10-year US Treasury yield closed up more than 2 basis points to 0.66%. Gold price per ounce breaks through US$1,800, the highest level since September 2011. The exchange rate of the Hong Kong dollar continued to be close to the strong exchange guarantee. The HKMA sold 11.47 billion Hong Kong dollars and 4.29 billion Hong Kong dollars respectively.
U.S. National Security Adviser O'Brien said it is closely watching whether Chinese applications use personal data for malicious purposes. Secretary of State Pompeo criticized Beijing for giving Hong Kong a high degree of autonomy for 50 years as an empty promise and urged China to fulfil its human rights obligations. Chinese Foreign Minister Wang Yi emphasized that China is still willing to develop Sino-US relations in good faith and sincerity.
Raphael Bostic, President of the Federal Reserve Bank of Atlanta, said that the epidemic has spread further and the Bureau should consider taking more actions to support the economy. Eric Rosengren, president of the Boston Federal Reserve Bank, believes that the US economic situation may be worse than most people expected in the summer and autumn of this year.
EUR: German Chancellor Angela Merkel called on the members of the euro zone to unite, respond to the risks of the epidemic and climate change, and use the reconstruction fund to invest in Europe's future.
JPY: Japan's core machinery orders in May increased by 1.7% month-on-month, which was an ideal drop of 5% from market expectations, ending the two-month decline. Bank of Japan Governor Tohiko Kuroda said that the consumer price index may temporarily fall, and the current economy is in a grim situation. If necessary, he will increase easing measures without hesitation, but emphasizes that the Japanese financial system is still sound
From a technical and trading perspective, in line with yesterday’s S&P500 view of range resistance developing, today, we revisit the EURJPY which has continued to trade above ascending trendline resistance. However, it is noteworthy that the market continues to find supply towards 121.80 and the yearly and monthly pivot, coinciding with the 50% retracement of the June decline. As such bearish exposure should be rewarded ona closing breach of the trendline support and the near term VWAP at 121.20, this will open up two key target test initially 119.50 a close through here would open the equality objective at 116.85, if this pattern develops then it would be wise to use 122 as an invalidation point for the bearish thesis
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Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!