EUR/JPY reacts to geopolitics

Source: Dukascopy Bank SA

Positions Today Yesterday % Change
Longs 34% 33% 2.94%
Shorts 66% 67% -1.52%
Indicator 4H 1D 1W
MACD (12; 26; 9) Buy Buy Buy
RSI (14) Neutral Neutral Sell
Stochastic (5; 3; 3) Sell Sell Sell
Alligator (13; 8; 5) Buy Buy Buy
SAR (0.02; 0.2) Buy Buy Buy
Aggregate

Geopolitical tensions involving North Korea and Japan have weighted heavily on the Yen, as risks-averse investors were taking their money out of this safe-haven currency.  

The strong appreciation of the Euro that started early in this session resembles other major currencies which have substantially increased in value against the Yen since the missile test. Markets started to react started already late on Thursday, as apparent from the highly volatile hourly candle at 22:00GMT. As a result, the previously-drawn ascending channel was breached, requiring to shift its borders to the upside. 

Even though technical indicators show a solid up-trend, it is more likely that the Euro allays and rebounds within the remaining trading hours, setting the 55-hour SMA circa 131.50 as the ultimate downside target.

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