EUR/JPY Forecast 24/09:Euro Levitates Against Japanese Yen

(MENAFN- Daily Forex)

• The euro initially dipped against the Japanese yen during the trading session on Tuesday but then turned around to show signs of life. The ¥175 level is an area that could offer a bit of resistance, and it does look like we are trying to get above it.
• If we can break the ¥175 level, then the market is likely to go looking to the ¥175.50 level. Short-term pullbacks I think make a nice buying opportunity as we have just broken above a massive ascending triangle.

Ascending triangle

The ascending triangle signals a potential run to the ¥178 level based on the“measured move”, but at this point in time, it's also worth noting that the uptrend line at the bottom of the ascending triangle offer support, with the 50 Day EMA backing that up as well. The ascending triangle is the most obvious signal that I see on this chart, but it should be noted that we have been bullish for some time anyway, so this is just more confirmation.

EURUSD Chart by TradingView

The interest rate differential of course is starting to offer an attractive“buy-and-hold” type of situation. All things being equal, this is a market that every time it drops, buyers will almost certainly be interested in buying, especially if there is any type of risk appetite out there. The risk appetite of course favors this pair going higher if people are willing to put a little bit of risk on the table, but it also favors this pair going lower if people are a bit concerned as the Japanese yen is considered to be a massive“safety currency.”

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On a breakdown from here, believe that the ¥170 level should be a major“floor in the market”, and if for some reason we were to break down below that level, then the euro could go plunging against the Japanese yen and I would expect that the Japanese yen would probably be strengthening against most other currencies in that environment as well.

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