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- Credit Agricole (based on CNBC)
Pair's Outlook
The European currency managed to pierce the immediate resistance yesterday, but failed to reach the second target, namely the 55-day SMA. Even though the EUR/JPY currency pair remains in a bearish trend, a breach of the 55-day SMA is likely to trigger a rally towards the 134.25, where the 100 and 200-day SMAs coincide with the resistance trend-line. However, on a smaller scale the Euro remains under pressure and could return below 132.00 and eventually to the 131.00 major level. A prerequisite for such progression is a breach of the 20-day SMA, monthly R1 and weekly PP cluster around 132.30.
Traders' Sentiment
Bulls and bears broke out of the equilibrium, with 52% of open positions now short. The share of buy orders surged from 25 to 42%.
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