The FX Specialist view – After EUR/JPY found interesting support from a long term 76.4% level earlier in 2010, initial bull signs appeared. The current s/term slip back might unnerve the early bulls but it is worth them keeping the faith for now.
- WEEKLY CHART:
After long term 76.4% support was found (not shown on this Weekly chart) there has been an initial recovery to the 23.6% level.
Beyond here, note how higher 38.2% nicely coincides with the 119.63 Feb low. - DAILY CHART:
After adopting an initial bull stance in the Commodity Specialist Guide the market has slipped back – to s/term 76.4% support just above 109.00.
Perhaps this level can work again.
It offers a limited risk opportunity to aggressive buyers (stops below the 107.30 Jun low), but bulls now need to see recovery.
First key resistance now comes from the 114.83/115.17 dual Fibo retracement area. A break through this would bolster the bull argument and turn focus on the 119.63 Feb low, just below which is 38.2% from the Weekly chart and just above a 61.8% level on this chart.
This still has the potential for an interesting recovery situation.
[For the complete and illustrated version of this and future Updates be sure to sign up at www.sevendaysahead.com]
