InvestMate|EUR/JPY Outlook Update๐ถ๐ด
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๐ถ๐ดEUR/JPY Outlook Update
๐ถ๐ดThis is yet another post in which I will try to give a more detailed presentation of my downside scenario on this pair. Because I think that price is still expensive.
๐ถ๐ดBeginning with the fundamentals:
๐ถLooking at economic growth in the Eurozone we are at levels of 2.1% This is quite average looking at the past.
๐ดCompared to Japan where we are currently at 1.6% this is also quite average looking at past periods.
tradingeconomics.com/japan/gdp-growth-annual
๐ถ Unemployment in the Eurozone is falling - the latest reading on 3 November showed a drop to 6.6% compared to last reading of 6.7%.
๐ด In Japan, on the other hand, unemployment rose from 2.5% to 2.6%.
๐ถ A week ago, on 17 November to be precise, the inflation reading, which was 10.7% on 31 October. The market is betting on a slowdown in inflation in the coming months.
๐ด In the case of Japan, inflation is gaining momentum even though we have maintained a 3% growth the market is betting that during the next data due on 17 November we could break this barrier and rise to levels of 3.2%.
๐ถ Eurozone interest rates were raised by 75 basis points at the last council meeting on 27 October to 2%.
๐ด In Japan, of course, no change, the council kept rates at -0.1% at its last meeting, but with inflation gaining momentum, further moves remain uncertain. For now, the market is pricing in an unchanged rate at the next decision on 22 November.
๐ถ๐ด Now that we know the fundamental environment, let's turn to the chart.
๐ถ๐ดI will present all the tools I used in turn:
๐ถ๐ด1 I have plotted the uptrend channel from the start of the strong breakout to the top.
๐ถ๐ด2. I measured with a fibo grid the entire upward wave.
๐ถ๐ด3. I measured the last downward impulse using the fibo.
๐ถ๐ด4. I measured the largest downward correction in the entire upward impulse to determine the extent of the 1:1 correction.
๐ถ๐ด5 I determined two support zones.
๐ถ๐ด(1) Based on the 1:1 level of the largest downward correction and the 0.5 level of the entire upward impulse.
๐ถ๐ด(2) Based on the 0.618 level and the previous strong price reactions, from this point the price made a rise to new peaks.
๐ถ๐ด6. I determined a resistance zone based on the 0.5 level and where price has reacted in the past.
๐ถ๐ดThe scenario I am playing out is a final descent to the 0.618 levels of the entire downward wave.
๐ถ๐ด*Please do not suggest the path I have drawn with lines this is only a hypothetical scenario for further increases.
๐If you appreciate my work and effort put into this post then I encourage you to leave a like and give a follow on my profile.๐
๐ถ๐ดThis is yet another post in which I will try to give a more detailed presentation of my downside scenario on this pair. Because I think that price is still expensive.
๐ถ๐ดBeginning with the fundamentals:
๐ถLooking at economic growth in the Eurozone we are at levels of 2.1% This is quite average looking at the past.
๐ดCompared to Japan where we are currently at 1.6% this is also quite average looking at past periods.
tradingeconomics.com/japan/gdp-growth-annual
๐ถ Unemployment in the Eurozone is falling - the latest reading on 3 November showed a drop to 6.6% compared to last reading of 6.7%.
๐ด In Japan, on the other hand, unemployment rose from 2.5% to 2.6%.
๐ถ A week ago, on 17 November to be precise, the inflation reading, which was 10.7% on 31 October. The market is betting on a slowdown in inflation in the coming months.
๐ด In the case of Japan, inflation is gaining momentum even though we have maintained a 3% growth the market is betting that during the next data due on 17 November we could break this barrier and rise to levels of 3.2%.
๐ถ Eurozone interest rates were raised by 75 basis points at the last council meeting on 27 October to 2%.
๐ด In Japan, of course, no change, the council kept rates at -0.1% at its last meeting, but with inflation gaining momentum, further moves remain uncertain. For now, the market is pricing in an unchanged rate at the next decision on 22 November.
๐ถ๐ด Now that we know the fundamental environment, let's turn to the chart.
๐ถ๐ดI will present all the tools I used in turn:
๐ถ๐ด1 I have plotted the uptrend channel from the start of the strong breakout to the top.
๐ถ๐ด2. I measured with a fibo grid the entire upward wave.
๐ถ๐ด3. I measured the last downward impulse using the fibo.
๐ถ๐ด4. I measured the largest downward correction in the entire upward impulse to determine the extent of the 1:1 correction.
๐ถ๐ด5 I determined two support zones.
๐ถ๐ด(1) Based on the 1:1 level of the largest downward correction and the 0.5 level of the entire upward impulse.
๐ถ๐ด(2) Based on the 0.618 level and the previous strong price reactions, from this point the price made a rise to new peaks.
๐ถ๐ด6. I determined a resistance zone based on the 0.5 level and where price has reacted in the past.
๐ถ๐ดThe scenario I am playing out is a final descent to the 0.618 levels of the entire downward wave.
๐ถ๐ด*Please do not suggest the path I have drawn with lines this is only a hypothetical scenario for further increases.
๐If you appreciate my work and effort put into this post then I encourage you to leave a like and give a follow on my profile.๐
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We have rebounded from 0.5
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๐ฒ t.me/Investmatez ๐ฒ
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