Euro index creates new weekly low: yen in consolidation

• Today, the euro index sank to a new weekly low at 1040.5 
• This week, we have seen a slight bearish consolidation in the yen index

Euro index chart analysis

Today, the euro index sank to a new weekly low at 1040.5. Soon after, we saw the initiation of a bullish consolidation and the index’s recovery above 1042.0. We have been under strong bearish pressure since Tuesday, and this slight recovery today does not inspire the Euro index to start a more concrete recovery. Based on that, we expect to see a further pullback to a new monthly low.

Potential lower targets are 1040.0 and 1039.0 levels. For a bullish option, we need a positive consolidation and stabilization of the Euro index above the 1043.0 level. After that, the chances increase that the index will start a new bullish impulse and continue its growth on the bullish side. Potential higher targets are 1044.0 and 1045.0 levels.

Yen index chart analysis

This week, we have seen a slight bearish consolidation in the yen index. Today, after the news about US inflation, the index suddenly returned to support at the 755.3 level. The data was positive for the dollar, which caused all other currencies to start retreating. The yen did the same, retreating below the EMA 200 moving average. Now, we have to go back above if we want to continue with the previous lateral consolidation.

After that, we expect to visit this morning’s resistance zone. Potential higher targets are 758.0 and 760.0 levels. For a bearish option, we need a negative consolidation and a breakout of today’s low. Thus, we fall to a new one and confirm the bearish momentum on the chart. All that remains is for us to see a further pullback of the yen index to the bearish side. Potential lower targets are 754.0 and 752.0 levels.

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