(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.)
4/27/2009 € EUR/JPY € Price action on EUR/JPY, a daily chart of which is shown, is continuing to display its bearishness after breaking down below a key parallel uptrend channel two weeks ago. After the channel breakdown, price found its downside target and stalled just above the major 126.00 support/resistance level before making a minor retracement back up in what appears to be a small inverted flag pattern. This week opened with substantial bearishness and has approached the low of the channel breakdown move and flag. Further bearishness that breaks down convincingly below 126.00 could subsequently target further major support around 122.00. To the upside, in the event of a resumption of the bullish retracement or consolidation, the 129.00 region should serve as significant upside resistance.
James Chen, CMT
Chief Technical Strategist
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