Return to Liquidity and the EUR/JPY

With a relatively light economic calendar week ahead, yet a potential return to liquidity in the markets, as the Summer doldrums should be officially behind us, trading should turn awfully interesting over the next few months. I expect a great deal of volatility and potential break out before the year is up.

I'm turning to the EUR/JPY, as this pair is very indicative of risk appetite in the global markets. Most recent economic data has pointed to a global recovery, including housing, jobs and earnings.

EUR/JPY looks poised to break out to the upside, per my chart above. I will be looking for opportunities to buy this pair. Of course, I will always look for an appropriate risk/reward situation before entering a trade.

I think the first Daily support level exists around the 131 level. Below that is 128 and then 125. I will look for opportunities off the hourly charts to get involved in what will hopefully be a very long and profitable series of trades.