The EUR/JPY pair has been in a significant uptrend for some time now. While that in itself is a necessarily news, I recognize that there is a significant amount of support below, and I think it’s only a matter time before the buyers step in. I think the 145 level is massively supportive, and it’s only a matter of time before we break out from that region. I think the buyers will continue to enter the market in that general vicinity, not necessarily because of any love for the Euro, just simply because nobody really likes the Japanese yen at the moment.
The European Central Bank may loosen its monetary policy going forward, but it will never be anywhere near where the Bank of Japan is. With that being the case, I don’t see any direction but up for this pair over the longer term, and I think currently we are simply consolidating between the 145 level on the bottom, and the 150 level on the top.
Patience will pay off
I think being patient will be what is necessary for this market. Just simply let it come back to you, and form some type of supportive candle in order to start going long again. I don’t really have any interest in shorting this market, and I think that there is massive support all the way down to about 143. So even if we break down below the 145 handle, I still wouldn’t be a seller at this point in time. With that being the case, I am simply waiting for the right supportive candle to go ahead and join the longer-term uptrend.
Ultimately, I think 150 will be broken to the upside, but it may take a bit of momentum in order to do so. Because of that, we will more than likely have to make a couple of attempts at it, but ultimately I believe that the writing is on the wall and that the Japanese yen will continue to be sold off.
