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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

​​​EUR/USD flatlines while EUR/JPY and USD/JPY resume their descents

​​Outlook on EUR/USD, EUR/JPY and USD/JPY amid lower volatility as the festive season approaches.

EUR/USD Source: Bloomberg

​​​EUR/USD trades in sideways range

EUR/USD continues to trade below last week’s $1.1009 high, formed marginally below its November peak at $1.1017, in decreasing volatility as the festive season approaches.

​The currency pair now flirts with its late-August high at $1.0945 while remaining above its $1.0889 low, made on Friday. Further minor support is found around the 14 November high at $1.0887 and the 22 November low at $1.0852.

​Only a rise above the $1.1009 to $1.1017 recent highs would put the 10 August high at $1.1065 on the cards.

EUR/USD chart Source: IT-Finance.com
EUR/USD chart Source: IT-Finance.com

​EUR/JPY resumes its descent

​Earlier this week EUR/JPY saw a rapid ascent to ¥158.57, as the Bank of Japan (BoJ) stuck to its ultra-loose monetary policy and provided no guidance on whether it may move away from it next year, before resuming its medium-term decline.

​The 11 December high and late-October low at ¥157.68 to ¥157.70 acted as resistance in what looks like an Elliott wave abc correction which is deemed to have ended at this week’s high. It should be followed by an eventual slip through the current December low at ¥153.18, provided no rise above ¥158.57 is seen.

On the way down potential targets are Thursday and Friday’s highs at ¥156.49 to ¥156.48., the 200-day simple moving average (SMA) at ¥154.56 and the mid-December low at ¥153.86. ​In case of a rise above ¥158.57 being seen, the 55-day SMA at ¥159.45 could be reached.

EUR/JPY chart Source: IT-Finance.com
EUR/JPY chart Source: IT-Finance.com

​USD/JPY once more slips

USD/JPY's rally from last week’s ¥140.95 five-month low as the BoJ kept its short-term rates at -0.1%, and that of the 10-year government bond yields around 0%, took it to Tuesday’s high at ¥144.95 before the downtrend resumed.

​USD/JPY is sliding to its 200-day SMA at ¥142.67 below which lie the 7 and 14 December lows at ¥141.63 to ¥140.95.

​Minor resistance above Thursday’s ¥143.56 high can be spotted at Wednesday’s ¥144.10 peak and the late-August to September lows at ¥144.45 to ¥144.54.

USD/JPY chart Source: IT-Finance.com
USD/JPY chart Source: IT-Finance.com

This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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