EURJPY Rally at Risk Sub 141- Weekly Opening Range in Focus

Talking Points

• 
  EURJPY struggles below key technical resistance around 141
  


• 
  Broader outlook constructive above 138.74- bullish invalidation
  


• 
  Event risk on tap from Japan & Eurozone
  

EURJPY Daily Chart

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

• 
  EURJPY testing key technical resistance at 140.95 – 141.17
  


• 
  Trading within ascending channel formation off the February low
  


• 
  Weekly opening range in focus- Break to validate scalp bias
  


• 
  Topside breach targets objectives at 142.06, 142.73 & 144.49
  


• 
  Support at monthly trendline, 138.74/94 (bullish invalidation) & 138.15/24
  


• 
  Daily RSI sub-60 (topside trigger with break above 141)
  


• 
  Failure of RSI to mount 60 turns bearish with break sub-50
  


• 
  Key Events Ahead: JapanCPI (Consumer Price Index) & Industrial Production data on Thursday and EurozoneFebruary Advanced CPI on Friday
  

EURJPY Scalp Chart

Notes: The EURJPY has been a popular pair in the DailyFX on Demand trading room and while a topside break of the monthly opening range does suggest we maintain our bias heading into the close of the month, the pair has now encountered critical resistance around the 141-handle. This region is defined by the 50% retracement of the decline off the December high, the 61.8% Fibonacci extension from the ascent off the monthly low and a longer-dated 61.8% retracement taken from the descent from the 2008 high.

Our immediate focus is on a break of the weekly opening range which is forming just below this key threshold. A topside break/close above 141.17 with RSI conviction keeps our bias weighted to the topside heading into the close of the week with such a scenario warranting long exposure into subsequent resistance targets. A move sub 140.33 puts us neutral with a break below 140.07 shifting our near-term focus to the downside.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

*ORH: Opening Range High

*ORL: Opening Range Low

Other Setups in Play:

• 
  USDCAD Reversal Underway- Long Scalps Favored Above 1.10
  


• 
  GBPAUD Weekly Range in Focus- Bullish Scalp Bias at Risk Sub 1.86
  


• 
  GBPCAD Challenging Feb Range High- Scalp Bias Bullish Above 1.8037
  


• 
  AUDNZD Target Key Resistance- Bullish Scalp Bias at Risk Sub 1.09
  


• 
  GBPNZD Scalps Target Opening Range- Higher Low in Place?
  

—Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

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EURJPY Rally at Risk Sub 141- Weekly Opening Range in Focus