EUR/JPY has been falling sharply since its 2014-high just a month ago in December, from 149.55 down to about 135. It is now back near the 2014-lows. Let’s take a look the charts.
In Oct through November 2014, the market rallied from the low on the year to a high on the year. Then in the past month, EUR/JPY has wiped out all those gains. This sharp reversal is indicative of exhaustion and capitulation, signaling the end to the bull market since 2012.
Now, we are looking at some support at 135. The medium-term outlook remains bearish within a long-term neutral mode. The near to short-term outlook is flattening and turning bullish. However, we need to first limit the bullish outlook to 138-139. A slightly more aggressive outlook would target 140.
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