After consolidating for the past 6 weeks, the EURJPY appears to finally be breaking out. The sideways movement formed a triangle, building up potential energy, while the direction remained unclear. Today’s decisive drop with extremely wide range bars points to a very clear breakout to the downside. The first support level is around 109, but may easily break past that point.
The NZD has stumbled after attempting to return to its uptrend, and is once again testing support at .7600. It is also attempting a break below the rising trendline, which extends back to the beginning of September. If price can break through, the next support level is near .7400.
The USDCHF continues to consolidate at resistance near 1.000. Although other European currencies have broken down, the CHF has remained stable so far. This relative strength, suggests that investors are piling into Francs as well as Dollars, leaving the cross stable. If prices can penetrate resistance, we could see a quick rally up to 1.03.
Written by bforex.com