Trading EUR/JPY: Navigating Between Key Support at 171.5 and Major Resistance
17 July 2024
The Euro to Japanese Yen (EUR/JPY) is currently experiencing interesting dynamics. The Yen, in general, has been quite volatile due to interventions from the Bank of Japan, making traders cautious about trading it. On the EUR/JPY chart, there is a clearly defined horizontal support at 171.5, marked in blue. This support level has been tested repeatedly, each time defended with long tails, but it keeps getting revisited.
In addition to this crucial support, the pair faces two resistance levels: a dynamic resistance marked in black and a horizontal resistance marked in yellow. This creates a scenario where the price is wedged between these significant levels. The best approach for trading this setup is to wait for a breakout. A daily close below the blue support would signal a sell, while a breakout above the black dynamic resistance followed by a close above the yellow horizontal resistance would indicate a buy signal. Traders should monitor these levels closely to determine the next move.