Hello Traders,
With positive news coming in from the Euro zone, it makes complete sense for us to trade this pair today. The technicals are good and so are the fundamentals. To begin with, last week’s inflation data came in as expected. The Germany economy is expanding with inflation accelerating faster than the rest of the bloc. As mentioned previously, this has positive contagion for the periphery countries who are trying to get out of the deflation dregs. This reason alone makes this pair a strong candidate for another bullish anticipation. Remember this week we have ECB monetary policy statement and while we expect things to remain largely unchanged, it will be Mario Draghi’s comments that could buoy this currency pair. Talks of future projections in monetary policy implementations, inflation and growth will be what investors want to hear. Also, despite Germany’s business and investor’s confidence being low, some bounce back is expected with this week’s release of revised Industrial production, factory orders and current account balance. If they are revised higher, the euro will remain upbeat.
Technically, the daily, 1Hr and 30 minute charts all have an oversold stochastics and it is trending higher. In the 30 min chart, revision is happening at the 38.2 Fibonacci level with an oversold stochastics. This trend continuation should provide an opportunity for a good risk reward ratio.
Trading will pan out as follows:
Buy: 120.80
Stop Loss: 120.30-below 38.2 Fibonacci Level
Take Profit: 121.80-161.8 Fibonacci extension
Have a good trading day.

EURJPY 30 Min chart-06.03.2017

Source: Dalmas Ngetich

EURJPY Daily chart-06.03.2017

Source: Dalmas Ngetich

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