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– UniCredit SpA (based on Bloomberg)
Pair's Outlook
Although the European single currency appreciated against the Yen on Tuesday, gains were insufficient to fully negate Monday's losses, with the pair adding 85 pips. Technical indicators suggest the EUR/JPY cross is to keep appreciating, but only if the 120.00 psychological resistance is overcome. The 120.70 mark is seen as the ceiling, as the monthly R3, the weekly R1 and the Bollinger band form a tough resistance cluster there. However, the main target is still the area around 122.00, represented by the weekly R2 and the ‘Brexit' high of 122.06. The base case scenario is a close at 120.50, assuming the pair managed to maintain trade above 120.00.
Traders' Sentiment
There are 54% of traders being long the Euro (previously 55%), while the portion of buy orders also weakened, namely from 61 to 51%.
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