EUR/JPY technical analysis for May 16, 2013
Overview:
The EUR/JPY's subsequent sharp fall suggests that a decline from 132.10 yesterday had resumed to 130.00 (strong support). The pair has already formed a strong resistance at the level of 132.80 and it is now approaching it in order to test it. Also it should be noted that the price is still trapped between 131.20 and 131.80 and has been set below strong resistance at the level of 132.80. Therefore, the fact that the yen will move downwards is rather convincing. The structure of the fall does not look corrective. It is likely to indicate a bearish opportunity below 132.80 (you should keep in mind that the weekly pivot point is at 131.50). It will be a good sign to sell below 132.80 with the first target at 131.83 and it will call for downtrend to continue moving towards 130.55. Furthermore, it should also be said that the price at 130.00 will probably form a double bottom and call for a strong support. So, it will be saturation around 130.00 to rebound the pair. The market might also be going to start showing the bullish signs. In other words, it will be a good sign to buy above 130.00 with the first target of 131.50 and continue towards 132.30.
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