The EUR/JPY plummets amid a rise in political risk

The Yen has been gaining a lot of strength versus its main counterparts, but especially versus the Euro as the political risks in Europe keep mounting. The possibility that the French elections could be won by one of the candidates against the European Union has kept the financial markets in Europe on their toes. On top of that, there were some explosions today in Germany just before one of the soccer games of the Champions League. The EUR/JPY breaks below the 117.00 level and it drops very close to the 116.00 level. The 116.00 level may act as a support, but if the political risks keep mounting, then the pair may break below that level. The 55 day EMA (purple line) is about to cross below the 200 day EMA (blue line) and if such cross occurs, then a “death cross” will be confirm, which is a pattern with bearish implications for the pair in the middle term. To the upside, the first resistance level may be the 117.00 zone, followed by the 118.00 level.

WTI oil breaks above the 53.00 level

WTI oil breaks above the 53.00 level and goes back to the congestion area that it created at the beginning of the year between the 52.00 level and the 54.00 level. The rally on WTI oil has been really spectacular from the 47.00 level, but it has been caused mostly by the geopolitical tensions surrounding the production and distribution of crude in the Middle East. On the daily chart we can see that the price of oil may continue heading higher, maybe trying to visit the 54.00 level. But if the bullish trend is to be kept in the mid-term, then WTI oil must break above its latest high around the 55.20 level. Due to the fact that the commodity is clearly over-extended to the upside, it may try to pull back down and visit the 52.00 level, which could act as support. Below the 52.00 level, the 55 day EMA (purple line) around the 51.10 level may also act as support, followed by the 50.00 round number level.

Possible trend reversal on the GBP/USD

The GBP/USD has been consolidating during the past couple of weeks and it has formed a symmetrical triangle on the daily chart, around the 1.2500 level. Today the Pound weakened amid the disappointing fundamentals out of the UK and the rally on the Dollar. The Dollar strengthen today despite the lower than expected reading on Non-Farm Payrolls, because the unemployment rate dropped from 4.7% to 4.5% and according to some analysts, that is a sign that the US is approaching full employment.  The drop on the GBP/USD causes the pair to break below the symmetrical triangle and below the 1.2400 level. According to the MACD indicator, the pair has apparently changed its trend to the downside on the daily chart. Therefore, the GBP/USD may try to visit the 1.2300 level. If the pair breaks below the 1.2300 level, then is will actually have the road clear to go and visit its latest low at the 1.2110 level. To the upside, the most relevant resistance is the 1.2700 zone where we can also find the 200 day EMA (blue line).

Will de Dow Jones go back up?

The Dow Jones industrial index reached an all-time high on March 1^st around the 21166 points and since reaching that level, the index started retracing back down. The doubts about the implementation of the economic stimulus that President Donald Trump has promised have been pressuring the US stock markets to the downside. One week after reaching its all-time high, the MACD indicator on the daily chart of the Dow Jones confirmed a bearish trend reversal. The index continued falling until it reached the 20475 point zone where we can find the 55 day EMA (purple line), which is currently acting as a support. Actually, the Dow Jones has consolidated just above the 55 day EMA and is heading sideways. The bars on the MACD’s histogram are getting smaller than the previous ones, showing us that the bearish trend is losing its strength. Therefore, the index may try to bounce back up, but on the other hand, if the index manages to break below the 20475 point level, then the bearish momentum may accelerate even more and the Dow Jones will practically have the road clear to reach the 20000 point area.

USD/JPY: Tries to go back down

The USD/JPY has tried to go back down and maybe visit the 110.00 level, as shown on the daily chart, and which could act as a support. In case the USD/JPY bounces to the upside from the 110.00 zone, then it could be forming a double bottom pattern. But in order for the double pattern to confirm itself, the pair must break above the 112.00 level. Before breaking the 112.00 level, the pair may find some obstacles to overcome like the 111.00 level and the 200 day EMA (blue line). Above the 112.00 level, the 55 day EMA (purple line) may act as a resistance, but a more relevant resistance could be the 114.00 level.

GBP/USD: Without a clear direction

The GBP/USD tries to go back up towards the 1.2500 level as shown on the daily chart, but in reality the pair has no clear direction and it is consolidating with the 55 day EMA (purple line) acting as a very good support zone. The intraday volatility has been high, but there is no clear trend on the GBP/USD. If the price breaks to the upside, then the 1.2600 level may act as a resistance as it did in the past. Above the 1.2600 level, the next resistance could be the 1.2700 zone, where we can also find the 200 day EMA (blue line) and which can contribute to making that zone a good resistance area. Below the 1.2400 level, the support levels could be any of the round number zones like the 1.2300, 1.2200, or 1.2100 levels.

EUR/USD: The consolidation continues

The EUR/USD has been consolidating during this week just below the 1.0700 level as shown on the daily chart. The MACD indicator is showing us that the bearish trend is still in place, but it is losing its strength, according to the bars on the histogram. From the current levels, the EUR/USD may head in any direction. If the pair breaks below the 1.0600 level, then its next support area could be the 1.0500 zone, which has been a congestion area in the past. Above the 1.0700 level, its next resistance could be the 1.0800 zone, where we can find the 200 day EMA (blue line) and from where the price may bounce to the downside. Above the 1.0800 level, the most important resistance zone is at the 1.0900 level from where the pair made a sharp move to the downside.