Today the pair strengthened amid mixed data from Japan. The Domestic Corporate Goods Price Index for October fell by 0.6% against the previous month, while was forecasted a fall of 0.4%, and by 3.8% against the previous year. At the same time, Machinery Orders for September grew by 7.5%, against forecasted 3.3%.
The pair is supported by the Bank of Japan decision to continue with easy with the tendency of its further easing, and strong labour market data that came out last Friday in the US that significantly increased the chances of interest rates hike in the US in December.
Today attention needs to be pair to the ECB President Draghi speech, Fed’s Yellen speech and speeches by few other members of the Fed that could increase on the market.
Support and resistance
On Friday the pair broke out strong at 122.50 (38.2% Fibonacci correction) and continues growing towards 123.70 (23.6% correction), 124.50 (upper border of an on the ).
At the same time, a breakdown of the level of 122.50 would lead to a fall towards 121.50 (50% correction), 120.60 (61.8% correction, EMA144 on the ).
OsMA and on the daily and weekly charts recommend long positions and turn to purchases on the 4-hour chart.
Support levels: 122.50, 122.00, 121.50.
Resistance levels: 123.70, 124.00, 124.50.
Pending buy orders can be paced at 123.20 with targets at the levels of 123.70, 124.00, 124.50 and stop-loss at 122.80.
Pending sell orders can be placed at the level of 122.70 with targets at 122.50, 122.10, 121.50 and stop-loss at 123.10.