JPYEUR unable to break through key resistance level
Japanese Yen/Euro (JPYEUR) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
JPYEUR ended Thursday at 0.008269 edging higher 7 pips (0.08%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (JPYEUR as at Mar 26, 2020):
Thursday's trading range has been 79 pips (0.96%), that's far below the last trading month's daily average range of 135 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for JPYEUR.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. After moving lower in the prior session, JPY/EUR managed to close higher but below the previous day's open, forming a bullish Harami Candle.
Unable to break through the key technical resistance level at 0.008326 (R2), the currency closed below it after spiking up to 0.008336 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. When prices bounced off a significant resistance level the last time on October 10, 2019, JPYEUR lost -0.74% on the following trading day. After having been unable to move lower than 0.008254 in the prior session, the FX pair found buyers again around the same price level today at 0.008257.
The forex pair shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling might accelerate should prices move below the close-by swing low at 0.008254 where further sell stops could get activated. With prices trading close to this year's low at 0.008139, downside momentum might speed up should the market break out to new lows for the year. Further selling could move prices lower should the market test February's nearby low at 0.008237.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R2" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for JPY/EUR. Out of 34 times, JPYEUR closed higher 55.88% of the time on the next trading day after the market condition occurred.