Technical Forecast for USD/JPY & EUR/USD
Forecast for 1st February 2013
EURUSD burst through major long term resistance at 1.3479/91 and the 200 week moving average at 1.3529 this week and we have now hit the next target at 1.3609/14. A push through here then sees 1.3653 and possibly 1.3690 above is achievable next week if not today.
We are of course very over bought but this is being ignored. Any drift lower finds support at 1.3550 but below here we may see 1.505 with strong support at 1.3476/468 likely to provide a floor if we fall this far.
The USDJPY has now beaten 91.48 resistance to continue the 4 month bull run and hit our next target of 92.08/12.
Time for a history lesson now. The USDJYP was on a roller coaster ride through the 1990’s, plunging in the first half of the decade and recovering most of the losses in the second half, to peak in 1998 at 147.66. A 13 year bear market followed which saw prices bottom at 75.35. Why does this matter today of all days? Because the first Fibonacci target for the bounce of the 13 year bear market is at 92.42 and we are a fraction from here. The market is very overbought on weekly and daily charts after an unstoppable 15 point rally in just 4 months.
92.42 may just put an end to this rally for now. If not the next target looks like 93.99.