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EUR/JPY trades lower before French election
Fri, 21 Apr 2017 14:01:10 GMT
Source: Dukascopy Bank SA
"It is kind of reminiscent of the big events last year where people know that it is a binary outcome so the best approach is to remain as cautious as possible."
- Simon Derrick, Bank of New York Mellon (based on Reuters)
Not being able to overcome the resistance cluster formed by the weekly R1 and the monthly S1 circa 117.22, EUR/JPY tumbled during the first hours of today's trading session. This move has erased a major part of its Thursday gains. The closest support located at 116.21 may give the Euro enough room for a free fall. Nevertheless, it is unlikely that this level is reached today. It is expected that the pair may close slightly below the 61.8% Fibonacci retracement. In a less likely scenario, the downside volatility may reduce in strength, setting the pair for a close above this level. The market remains cautious in anticipation of the first presidential election round in France this Sunday.
Today's market sentiment is bullish, as 61% of open positions are long. In addition, 60% of set up orders are to buy the Euro.
© Dukascopy Bank SA
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