EUR/JPY forecast for the week of January 25, 2016, Technical Analysis

The EUR/JPY pair initially fell during the course of the week but found enough support to turn around and form a hammer. This is essentially a double bottom at this point, so we have to see what happens next but at this point in time we would suspect a bounce is coming. However, we recognize that the 130 level is resistive, so we need to get above there in order to start buying with any type of confidence. In the meantime, we will stick to the short-term charts as is market will probably be fairly volatile.