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- Credit Agricole SA (based on Bloomberg)
Pair's Outlook
The European single currency plunged against the Japanese Yen on Friday, which in turn strengthened on the BoJ's disappointing statement. The second support area was also pierced that day, causing the EUR/JPY cross to drop to the 114.00 psychological level. Technical indicators today are giving bearish signals, suggesting that a correction is unlikely to take place. Moreover, the pair faces a relatively strong resistance area around 114.75, namely the 20-day SMA, the weekly and the monthly PPs. This cluster is expected to trigger another Euro sell-off, causing the exchange rate to breach the 114.00 psychological level.
Traders' Sentiment
Today 69% of all open positions are long, compared to 64% previously. Meanwhile, the portion of sell orders returned to last Thursday's level of 58%, up from 40% on Friday.
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