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Will the Swing Failure play on EURJPY?

Thursday, February 15, 2018 9:21 AM GMT

All main EU markets posted annual growth in car sales as the demand for passenger cars raised 7.1 percent in January while total sales were 1.25 million units in January. European Traders will be concentrating on speeches by ECB policymakers Praet, Mersch and Lautenschlaeger.  On the other hand, we are expecting many events during the US session. Market anticipate for US Initial Jobless Claims (Feb 9) (Previous: 221K, Forecast: 230K), Philadelphia Fed Manufacturing Survey (Feb) (Previous: 22.2, Forecast: 21.1), US Industrial Production (MoM) (Jan) (Previous: 0.9%, Forecast: 0.2%) and NAHB Housing Market Index (Feb) (Previous: 72, Forecast: 72). This means that we are expecting volatile price action later today.

Regarding the technical overview of EURJPY pair, it formed a potential swing failure as noted in the daily chart. This pattern has taken the short-term pressure off the downside. If the pair closes above 5 EMA, it will set the stage for the next upside extension. However, traders should watch Stochastics (8, 3) that is flatting. This can be considered as a sign of bullish weakness.

Daily

Heading to the hourly TF, we have drawn some intraday resistances and supports. If price breaks above 133.28 and confirms it, then it will give a measured target at 135 level. Before this, the 200 SMA acts as an extra resistance. On the other hand, if price heads below 132.7-30 zone, it will negate any positive scenario.

Hourly

(EMA = Exponential Moving Average, SMA= Simple Moving Average
5EMA=Blue, 21EMA=White, 200SMA= Yellow)

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