(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; chart patterns in white; 50-period simple moving average in light blue.)
3/31/2010 - EUR/JPY - Price action on EUR/JPY, a daily chart of which is shown, has made a tentative breakout above the horizontal neckline of a well-formed inverted head-and-shoulders formation (a bullish reversal pattern). This neckline resides in the important 125.00 price region. The key initial upside target on this neckline breakout resides in the very significant 127.00 support/resistance area. Any further breakout above 127.00 could target further upside resistance in the 129.00 price region. If the neckline breakout proves to be true, the noted 125.00 level should become new support where it was previously neckline resistance.
James Chen, CMT
Chief Technical Strategist
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