EUR/JPY: Looking to enter short position near 133.80
This pair has come a long way over the past 12 months and I feel we are soon going to see a sharp retracement lower towards 120.00 perhaps. Most of this move is likely to come from an overly long USD/JPY market in my opinion, but I prefer the technical set-up in EUR/JPY.
Corporate sell orders will be very solid towards 100.00 in USD/JPY and I expect technical resistance in the cross to be very strong between 134/135. Sentiment, especially amongst retail players, seems to be quite bullish so I think we will probably see another 75/100 pips at least on topside before the momentum wanes.
I will start selling near 133.80 and will look to build on this position ahead of 135.00. Obviously I need to keep my initial stop above 135.50 so I’m starting out with a smaller position.