EUR/JPY
The cross movement is a mirror image of the EUR/USD pair. After the FOMC meeting, this cross is doing what the major pair EUR/USD is doing. Last week, the cross managed to close above 200Wema at 129.58. Today, at the early Asian session the euro is trading lower against the USD, JPY, AUD, and GBP. The pair has been facing strong resistance at 20Dsma. The pair has been thrice rejected from 20Dsma. At today's early Asian session, it was again rejected. The prices are closed and trading above hourly moving averages. Until the price closes above 128.70, bulls are trying to hold their grip. This view is valid for this week. Weekly resistance seems at 130.85 and 131.70. Support is found at 128.70.
For an intraday view, the support is placed at 129.65 and 129.25. We recommend selling below 129.25 with targets at 128.75, 128.25, and 128.00 initially. Today, the cross opened on a bearish note. We recommend buying above 130.85 with targets at 131.00 and 131.60.
Trade:
Selling below 129.25.
Buying above 130.85.
Risky trade: selling with sl 130.80.
EUR/GBP
David Cameron said on Friday that EU leaders and officials will breathe "a sigh of relief" if he loses the general elections in May. Cameron said, “If you vote for anyone else, you are likely to get a prime minister who comes here and says, 'You can all relax, there will be no renegotiations, no referendum, no difficult choices, no difficult reforms – breathe a sigh of relief.' In case, Cameron wins the upcoming election, he opts for the EU referendum. Compared to the euro, the pound sterling looks more fundamentally strong. Traders prefer to buy the pound on dips, but not the euro. The UK's new government will print the longer-term outlok for this pair and especially the GBP.
The pair stalled its 3-week losing streak and managed to close at a week high. The parallel resistance seems at 0.7301. In case the price closes above 0.7300, we can expect a strong upswing (250+ pips). But the chances are remote. Support is found at 0.7210 on a closing basis. At the Asian session, the pair is trading on a negative bias. Intraday support seems at 0.7229. Weekly support is found at 0.7190 and 0.7150. It sets a minor base around 0.7100. We recommend intraday selling below 0.7210 with targets at 0.7190, 0.7150, and 0.7100. We are highly bearish towards the euro on a long-term view. Keeping this in mind, we recommend using any rise to sell or place sl at 0.7305 on a closing basis holding the selling positions. The panic will be triggered below 0.7100 in case the daily price closes below this level. A new short-term optimistic trend will ignite above 0.7305, but chances are very remote. The UK's political disturbances can produce a relief rally in the near term.
To contact the author of this analysis, please email joseph.wind@analytics.instaforex.com.
