VOT Research Desk
Nov 2,2022
Market Analytics and Considerations
Reversals took hold, causing the EUR/USD to fall from a 2-month high. The EUR/JPY has suspended its ascent at elevated levels as it seeks a high mark.
Have we reached the bottom of the EUR/USD rate if the Euro regains support?
After rebounding from a low that was 20 years old at the end of September, EUR/USD performed well throughout October.
The price action attempted to break above the 100-day simple moving average (SMA) at 1.0090 but was unable to do so. In advance of the high of 1.0198 in September, this level may continue to serve as resistance.
In the 1.0340–1.0370 region, further up, there is a group of break points and a previous peak, which may provide resistance.
Last week, the high of 1.0090 broke out of the upper band of the Bollinger Band that is based on the 21-day SMA.A reversal took place as soon as the price returned to its previous range.
The price closed significantly lower on the same day that the previous week’s high was reached, forming a Bearish Engulfing Candlestick.
This would still be regarded as a Bearish Engulfing Candlestick despite the fact that it would be marginal if one paid close attention to the price openings and closings on the two days in question. However, due to the way foreign exchange trades over time, this formation would still be marginal.
The 21-day and 34-day SMAs, which are currently at 0.9844 and 0.9837, respectively, may provide nearby support.
Support may be found further down at the previous lows of 0.9705, 0.9632, and 0.9536.
EUR/JPY TECHNICAL ANALTICS- The EUR/JPY
has stabilized over the past week after reaching a record high last month that was 8 years old. The price circling the 10-day SMA serves as an illustration of this range trading environment.
Bullish momentum in the medium and long term may still be underlying. Price must be above the short term simple moving average (SMA), the medium term SMA must be above the long term SMA, and so on for a bullish triple moving average (TMA) formation to occur. Additionally, all SMAs must have a positive gradient.
The requirements for a TMA have been met by looking at the 21-, 34-, 55-, 100-, and 260-day SMAs. Short-term bullish momentum could emerge if the price moves above the 10-day SMA and its gradient turns positive.
The most recent high of 148.40, the high of 149.79 in December 2014, or the Fibonacci Extension level of 151.29 could serve as resistance.
The break point of 145.64 or the previous lows of 143.75, 140.90, 137.37, and 134.95 may serve as support.
