(113,50) The EUR/JPY formed on Friday a negative day reversal after a test of the 114,70 level, just below the 200 weeks line at 114,99. A daily closing today below 113,29 will confirm a s/t top suggesting further downside risk or let’s say less upside potential. The monthly and yearly closings will however be strong and positive; in the yearly chart the cross will manage to form a positive year reversal reversing last year weak closing but only a yearly closing next year-end above 114,70 will confirm a bottom supporting a higher cross in the m/t! The indicators of the m/t charts are positive but all more or less are showing overbought conditions and potential negative reversals suggesting the upside will be limited at least suggesting there is room for a correction, even a sensible one. Last time we had a similar situation, we mean a positive year reversal was in 2000; before moving much higher the cross confirmed a 50% retracement!! In today’s conditions it would mean a return at least toward 105!!
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