Forex Technical Update
EUR/JPY 4H Chart 8/22/2012 8:20AM EDT
The answer to the previous EUR/JPY update "triple top vs consolidation range" is that it was a consolidation range. TheEUR/JPY held above range support and pushed through resistance near 98.32. The breakout stalled just under 99.20 and is consolidating again. As far as price action, momentum, and trend strength is concerned, the pair is very bullish in the short-term. 1) Price making new highs and lows. 2)The RSI held mostly above 40 after tagging 70, and has kissed 70 again. 3) The moving averages are in bullish alignment.
If the US session holds the consolidation above 98.30, it is still in a clear bullish trend. However, a break below 98.00 and a break below the rising channel since 8/13 suggests some further short-term correction. Still the medium term bullish outlook remains until a break below 96.50 and the risin trendline since July 24.
If the market hangs on the to the bullish outlook, the next key level to monitor fro resistance is the 100 psychological handle, and the the 101.60 June high.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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