width=398(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

12/04/2009 - EUR/JPY - Within the past week, yen weakening has been one of the dominant themes, as shown on the accompanying EUR/JPY daily chart. This yen weakening has manifested itself as significant recoveries in the USD/JPY as well as all of the major yen crosses. Price action on EUR/JPY has been traveling in a well-defined trading range with no discernible long-term trend since March. The current bullishness in the pair is an extension of a pronounced bounce off the bottom of the range, around the 127.00 support region, where a clear hammer candle formed. Further yen weakness off of this range support bounce could potentially target the top of the range, around the general 139.00 resistance area.

James Chen, CMT
Chief Technical Strategist
FX Solutions

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