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- VIDEO – Targets for GBP, USDJPY and EURO - October 5, 2016
- RBA Meeting Preview - October 3, 2016
- How to Trade the Dollar into the Presidential Debate - September 26, 2016
- Here’s How to Trade the Sept ECB Rate Decision - September 7, 2016
- Bank of Canada September Preview - September 6, 2016
- Will August Payrolls Disappoint the Dollar? - September 1, 2016
- Where is the Dollar Headed this Week? - August 29, 2016
- Will Aug NFPs Help or Hurt USD/JPY? - August 4, 2016
I have long said that EUR/JPY is one of my favorite recession trades. With the Eurozone in a recession and the need for the European Central Bank to step up to the plate and lower interest rates, the rate differential between the Euro and Japanese Yen will close and close rapidly. Furthermore, as US equities continue to tumble, EUR/JPY will follow suit.
But what I really like about this currency pair is that it is breaking out of a recent consolidation to the downside. As indicated by the chart below, the currency pair has entered the “Sell Zone” which I determine using Bollinger Bands. That level coincides with triangle support and the 23.6% Fibonacci retracement. As long as the currency pair does not rebound and
take out close above today’s high of 120.47, I think it’s headed to 115 and maybe even lower.