EURJPY - Bearish below 109.10

Bearish signals for the quarter and for last week have been confirmed with investors selling EURJPY to a new nine-year low on Friday at 105.30. A one year bullish weekly trend of higher lows has been broken and prices remain firmly below the pivotal 200 day average rate. While last week’s over two Big Fig losses and second down-week in a row is negative, daily signals for sentiment are at oversold extremes and the market has not posted more than two significant down-week’s in over a year, since May 2010. So while there is no sign yet that Yen strength is ending, this week’s outlook remains just cautiously bearish below 109.10. The immediate objective is 105.30, last week’s nine-year low, with a move through this point targeting 104.00 and then towards 101.00.
The risk to this call however would be with buying through a stop at 109.10, Wednesday’s high, a cautiously positive signal improving sentiment to 109.98, last week’s top and then towards 111.94, the August high trade.