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Daily Forecast For EUR/JPY: January 7, 2013

ByIan Copsey
Published 01/07/2013, 12:06 AM
Updated 07/09/2023, 06:31 AM
EUR/USD
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USD/JPY
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EUR/JPY
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BIG
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AWRE
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BIAS:

There is still more risk of seeing a deeper correction lower now but care is still required.

Resistance: 115.41-54 115.98 116.31 116.84
Support: 114.79 114.27-50 113.65 113.05

MAIN ANALYSIS: Friday saw price manage to recover to 115.64. With USD/JPY looking a little suspect we do still need to be aware of a potential fall from grace. A break below 114.27 would push this towards a bearish outcome but below 113.90 and then the 113.65 low to extend losses to retest close to the 113.05 low. Take care and be prepared for a pullback - and possibly to the 113.90-00 area - before further losses can be seen. Below 113.00 would suggest further losses that should move to 112.45 and 111.66 though I suspect it'll need a bit of time.

COUNTER ANALYSIS: Any earlier move above 115.41-54 would see the 115.98 high tested and probably then 116.31 at least. If there is any sense of strength from EUR/USD then be prepared for a move higher to 116.84 - 117.17 and then the stronger 117.50-65 projection target.

MEDIUM-TERM ANALYSIS:
4th January: The losses in EUR/USD have changed the approach somewhat. At all times, considering the basically shallow corrections since the 105.97 low (and actually from 100.32 also) does imply some deep corrections at some point. Therefore don't fight the losses if they begin. However, I can't see the really big one just yet as we have to satisfy the deep correction required from the 105.97 low first. If this occurs directly then the 111.66 area should support for new highs - at least 116.31 but could be 117.17-50.

Any direct gains from current levels could see a new high around 116.61 before a deeper correction...

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