EURJPY - Monthly long-term Overview

The Euro-Yen presents a Falling wedge on monthly charts after breaking the lower ascending trend line, with a rebound from the new lows to retest the break.On weekly charts this pair is still navigating inside the descending channel, pointing towards the upper line, while on daily as of today the rising wedge showing on the chart below has been broken, retesting 113.00 level and later on was rejected back up where it has been ranging over the last two days.

This pair still looks bullish to me however we would have to be attentive to which type of price action it will manifest if it is able to break above the recent daily highs. By now 114.75 has been acting as resistance and 115.65 has to be surpassed, but as long as it is trading above 113.40 there are chances to see the longer term scenario coming into play.

EURJPY could reach 38.2 Fibonacci retracement level at around 118, or even make a further push to the 50% pulling back to around 122.00 where it would be checking against the monthly broken support.

(Daily chart assessment taken one hour before US markets open on Monday October 11, 2010)

EURJPY	RES2	RES1	SUP 1	SUP 2	R/R	FORECAST	PRICE ACTION
Monthly	169.99	126.55	105.41	96.20	1:1.3	Consolidation-UP	Falling wedge
Weekly	139.24	117.17	107.82	105.41	1:2.3	Bearish	Tweezer bottom in desc. channel
Daily	116.75	115.70	113.27	105.45	1:1.2	Consolidation-UP	Ascending channel