Long entry follow up on the EUR/JPY

We have seen a few days back that the 135.00 level on the EUR/JPY has become a good resistance zone for this pair. Due to the fact that the price has been visiting more often this level, the probabilities of a bullish breakout have risen. That is why we have decided to take a long entry just above the 135.00 level, expecting a continuation to the upside after the breakout. The take profit level is just below the 136.00 level and the stop loss is currently at breakeven. Therefore, this position is risk free at the moment. Let’s see how the price keeps behaving around this area.

AUD/USD 4 Hour Chart, breakout or bounce?

The Australian Dollar versus the Greenback has found a good support around the 0.7800 level during the last 4 hour candles. The price is currently visiting the 55 exponential moving average and it could try to break it to the upside. However, the 55 EMA has proven to be a good dynamic resistance for the AUD/USD on the 4 hour chart. If a breakout does happen, then a visit to the 0.7900 level is possible. Attention to a possible bounce to the downside from the 0.7900 level, because the zone was a good support in the past and now it may act as resistance.

The GBP/JPY has reached a key resistance area

After the Non-Farms Payroll report out of the US, the Dollar has strengthen and the Yen has weaken versus its main counterparts due to the rise in risk appetite. That is why we saw the GBP/JPY rising rapidly. After the pair broke the 180.00 to the upside, along with the 200 period exponential moving average on the 4 hour chart, it reached the zone between the 181.50 level and the 182.00 level. This 50 pip area could become an important resistance for the pair and we could see a bounce to the downside. The last 4 hour candlestick has closed with a “spinning top” formation, which indicates a possible exhaustion of the bullish rally. If the price comes back down to the 181.00 level, that area could become support again.

Symmetrical Triangle on the Kiwi 4 hour chart

The NZD/USD has consolidated around the 0.7400 level and has formed what appears to be a symmetrical triangle formation on the 4 hour chart. The symmetrical triangle is a continuation pattern, but we should be careful, because the price may break out in any direction. None the less, the pattern has a higher probability of breaking out in the direction of the trend coming into the formation, which in this case is upwards. A bullish breakout could take the price to the 0.7500 level, where it may find some kind of resistance. However, if the price keeps heading higher, it may touch the 200 period exponential moving average (blue line) around the 0.7567 level, which could become an important resistance for the pair.

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Pullback on the AUD/USD towards the 0.7700 level

The Australian Dollar dropped unexpectedly during today’s session after the interest rate cut announcement by the Reserve Bank of Australia. Initially, the AUD/USD drops from the 0.7800 zone until it breaks below the 0.7700 level. The pair has fallen to the 0.7625 level from where it has started to make a correction to the upside. At the moment, the price is very close to touching the 0.7700 area again, and the zone could become a good resistance for the pair, mostly because this is a round number level. Let’s be on the lookout for a possible bounce to the downside from the 0.7700 area, especially because a breakout-and-pullback pattern may develop.

First week of February is full of fundamental data

This week we have scheduled some very important fundamentals that could make volatility rise once again in the markets. On one hand, we have the PMIs from the United States, we also have the rate decision and statement from the Bank of England. Lastly, on Friday we have Non-Farm Payrolls out of the US, this piece of data is very important and it could create high volatility in the markets. It is expected that the US economy created 231,000 new jobs during the month of January. If the reading comes out better than expected, then the greenback could strengthen and the EUR/USD could reach new lows.