Good morning Traders!

Yesterday the Bank of Japan got a new leader, and the big question on traders mind is
how will the current monetary policy be affected and what implications will it have on the
Japanese Yen. There are speculations that we might see a change in the yield curve
control sooner than expected, and some are even predicting rate rise in Japan in the 4th
quarter.

EURJPY

Let’s apply a top down approach and start with the Monthly chart. The market is in an
uptrend on the Monthly chart, and after printing a new Higher High, it had pulled back
into it’s Moving Averages. This month’s candle has already broken the high of the
previous month candle, though price could not hold this level yet.

While the Monthly chart was pulling back, the Weekly chart changed direction, however
the last couple of weeks are showing consolidation.
Looking at the Daily chart for more information on this consolidation, and we can spot the
strong S/R level of 143 being tested many times during this period. Zooming out and we
can see the importance of this level, as it also offered strong Support previously as well.

Yesterday, we saw the market touching this level once again, with the Daily candle closing
near the high of the day. For a potential setup, I’d like to see further compression of price
underneath the 143 level to allow for a potential tighter stop loss.
However if the market will break the 143 area without further compression, then I will be
looking for a potential retracement setup, if the market will pullback to test this level from
above.

Happy Trading!

Tamar Mehr

Tamar Mehr is a professional trader, neuropsychological trading mentor, FXGlobe Ambassador, and decision-making expert. She’s based in Brisbane, Australia.

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Our Ambassador’s Daily Picks are not trading advice. These are informational articles covering the events which happened in the market already & scheduled events which are scheduled to happen in the Economic & Earnings Calendar.

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