The EUR/JPY is trapped by the EMAs

The EUR/JPY is currently trapped in between the 55 day exponential moving average (purple line) and the 200 day exponential moving average (blue line). On the daily chart we can see how the 55 day EMA was acting as a support during the month of January, but at the beginning of February, the price breaks below that moving average to go and visit the 200 day EMA, which acted as a support. Normally, when the price bounces from the 200 day EMA and visits the 55 day EMA, it stays bouncing on and off those two moving averages, consolidating without taking a clear direction. The 55 day EMA is acting now as a resistance and the price has gone back to the 200 day EMA where it stalls at the moment. Inside those bounces one could take the opportunity to enter the market, but it is kind of risky, because the price may break out of the consolidation at any moment.  If the price breaks to the upside, then the 122.00 level could act as a resistance, followed by the 123.00 level. If the price breaks to the downside, then the 119.00 level may act as a support, followed by the 118.00 level.

Symmetrical triangle is still in place on the GBP/USD

The GBP/USD has been oscillating up and down around the 55 day exponential moving average, purple line, without taking a clear direction. The range on the daily chart has been narrowing, creating a symmetrical triangle pattern. From this zone, the price could head in any direction; therefore, the best thing to do is to wait for a real confirmation of the breakout, either to the upside or to the downside. The complicated thing about such trendline breakouts is that the price could pullback at any moment. In this case of the GBP/USD, to make sure that the breakout is real, if it breaks to the upside, the price has to rally above the 1.2600 level. If the breakout is to the downside, then it should break below the 1.2300 level. To the upside, the most relevant resistance is at the 1.2800 level. To the downside, any of the levels from the 1.2200 level, the 1.2100 level, or the 1.2000 level could act as support.

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The EUR/USD bounces from the 61.8% Fibo

Today we had the CPI data from the United States, along with the retail sales numbers, which all came out better than expected, causing the Dollar to strengthen versus the Euro and it seemed like the pair was going to continue falling further during today´s session. But we can see on the daily chart that once the price got to the 61.8% Fibonacci retracement, it bounces from that level rapidly to the upside. The long lower shadow on the daily candle is showing us that the buyers came into the market with force. At the moment, the EUR/USD stalls at the 50% Fibo, around the 1.0588 level, but if it continues rising, then the 38.2% or the 23.6% could act as resistance. To the downside, the 61.8% could act as support, but a much important support could be the 76.4% Fibo at the 1.0456 level. 

The Dollar Index keeps its bullish trend

The Dollar index has confirmed the breakout of the 55 day EMA (purple line) and it is currently heading towards the 50% Fibo. It is possible for the 50% Fibo to act as a resistance in case the index reaches that zone, but the most relevant levels that could act as resistance are the 61.8% at the 102.03 level and the 76.4% at the 102.71 level. Today, the comments by Janet Yellen have supported the Dollar, after she said that there may be a need to raise interest rates in the upcoming meeting by the Federal Reserve. Therefore, it is possible for the Dollar to keep rising during the next few weeks. But we could also see a pullback of the index towards the 55 day EMA, which could act as a support, even if it is only temporary.

Trend reversal on the EUR/USD

It is said that when an asset retraces more than 20% of its previous trend, the trend has reversed in the opposite direction. In the case of the EUR/USD we can see on the daily chart that the pair had a good rally from the 1.0350 level to the 1.0840 level from the month of December until the end of January, but then it starts to retrace to the downside. The price of the EUR/USD has already retraced 50% of that rally and we can now say that the trend has reversed to the downside. At the moment, the pair is around the 1.0600 level, which is currently acting as a support, but if it breaks that level to the downside, then the bearish momentum may accelerate and the pair may drop to the 1.0400 level. In case the pair breaks above the bearish trendline, then it could go and visit the 1.0700 level, which is possible to act as a resistance, but at the moment the bearish momentum is still in place.

The USD/JPY tries to reverse its trend

The USD/JPY has been in a well-defined bearish channel, but during the past two days it has been rising until reaching the upper trendline of the channel. It is possible for the pair to try to change its trend to the upside, but in order for the trend reversal to take place it would have to first break above the 55 day EMA (purple line), the upper trendline, and the 114.00 level. At the moment, those factors have been holding the price back, but a break out of that zone could accelerate the bullish momentum on the pair all the way towards the 116.00 level. Anyways, for that to happen the Dollar would have to continue gaining strength and the Yen would have to be pressured by a rise in risk appetite. To the downside, the 112.00 level could act once again as a support, but the 200 day EMA (blue line), could act as a better support.