Forex Video Briefing (7/9) – EUR/JPY, GBP/JPY, CAD/JPY

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Forex Video Briefing (7/9) – EUR/JPY, GBP/JPY, CAD/JPY

EUR/JPY bounced off a recent slightly bullish channel support as you can see in the 4H chart. This channel reflects consolidation not a bullish market. In fact the prevailing trend is bearish. Still, today’s rally suggests some near-term bullish bias, and allows us to judge whether the market is going to be done with consolidation. For example, if the current rally tops off in the 138.80-139 area, we would see a failed attempt to challenge last week’s highs near 139.30. This appearance of a lower high would be the 1st clue of bearish continuation. Another clue could be the 4H RSI holding at 60. After tagging 30, a hold below 60 shows maintenance of the bearish momentum established by the most recent downswing in the 4H Chart. In this scenario, the pressure will be toward the June-lows near 137.80, with further downside risk toward the February and 2014-low to 136.22.

While EUR/JPY has a prevailing bearish outlook that suggests traders might sell after the current rally, GBP/JPY looks to continue a prevailing bullish trend on the back of today’s risk-on trading. After bouncing off 173.75, staying above the 100-4H SMA, and a pair of rising trendline from the 169.53low, the GBP/JPY has returned above 174. The market looks poised to send GBP/JPY toward the 175.25-35 highs on the year. It is not inconceivable that we might get further consolidation, especially if the pair holds under 175.00, but the bearish outlook should not enter the picture until at least a break below 172.35.

The CAD/JPY retreated from 96.22, but found support at 95.00, and the 100-4H SMA. The prevailing trend is bullish as you can tell from price action. The moving averages were moving apart, suggesting recent acceleration of the uptrend. The dip from 96.22 to 95 thus should be seen as a bearish correction swing. With the bullish mode intact, there are likely to be buyers after the correction swing. So far this week, we are seeing this bullish continuation attempt, as price moves above a falling trendline from last week’s 96.22 high. The bearish outlook is shelved unless there is a break below 94.70. Otherwise, the current bullish outlook has upside to 96.22 and then some common highs from 2013 in the 97.20-97.45 area.

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Jonathan Millet is currently the proud CEO of ForexMinute.com, the brand new financial news portal which is making waves among Forex traders around the globe for the innumerable Forex resources it offers. He also holds the position of Binary Options Consultant at ForexMinute.com. Before ForexMinute.com was around, Jonathan was a successful Forex dealer and chief market analyst at Forexyard. He has also worked as a Forex trader. His other specialties include advising financial companies of how to stay head of the competition.