By FXEmpire.com
EUR/JPY looks absolutely horrible at this point. The Tuesday session was very bearish, and we did manage to pierce below the lows of the Monday hammer. This of course is a very bearish sign, and as such we are short of this pair and certainly wouldn’t buy it.
The one caveat of course is to pay attention to how the Dollar trade against the Yen. If the dollar falls apart against the Yen, the Bank of Japan could intervene in this would send all Yen related pairs higher. Because of this, even though we are short and think that this pair should continue much lower, we have to keep an eye on the UDS/ JPY pair to gauge whether or not the Bank of Japan is likely to intervene. As long as that pair doesn’t meltdown itself, we should be perfectly safe.
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Originally posted here
