Forex Week Ahead: More Buys on USD/JPY And EUR/JPY

What’s the best currency pair to look forward to trading tomorrow?

I say you keep an eye on the USD/JPY.

If you haven’t traded the pair in the month that ended or at least looked at the chart, then perhaps you have not noticed that it has been on a strong uptrend.

Just look at the chart below, the volume that’s been driving the pair on the 1-day chart, and the strength of the trend.

USD/JPY: Daily Chart.

The week ended with the formation of a flag and it might just be the fast of many other flags that might form as the week continues to mature.

If your risk tolerance is on the roof then you may want to take your chances with a BUY on that breakout. But if I were you, I’d wait for a retest or at least look at other time frames or get information from other indicators.

USD/JPY: 4 Hour Chart

For example, the 4-hour chart reveals other interesting information.

There is an area of value marked resistance in the chart below.

And information from the RSI also shows that the pair is overbought which means that there is a great chance of retest before a continuation.

Wait for either a breakout on resistance or a retest on support 2.

Also, be sure to check on the USD/JPY when the market opens to increase your chances of opening a legit trade with higher chances of making profits.

EUR/JPY Daily.

After almost 7 years the EUR/JPY is back to the 140.591 level.

This is a price level it reached last in 2015 and it was faced with a strong resistance that drove it down and fast back to 110.500.

Considering that the RSI is above the 50 levels on the daily chart.

And last week the momentum on the EUR/JPY pair was so strong and the volume was enough to push the pair to the top 5 gaining currencies in the week that ended.

Will we see a EUR/JPY breakout in the week ahead?

Expect a bullish week on the EUR/JPY pair if a breakout happens and the price goes past the 50% level on Fibonacci from the 12th May downswing.

Tagged With : Daily Forex Analysis