The euro may fall to a five-week low against the yen as momentum charts show “sell” signals for the European currency, Bank of Tokyo-Mitsubishi UFJ Ltd. said, citing trading patterns. Europe’s single currency may extend its decline to the 90- day moving average of 124.38 yen as it sustained losses below so-called support at the 21-day moving average of 131.82 yen for the past three days, said Masashi Hashimoto, a Tokyo-based currency analyst at Bank of Tokyo-Mitsubishi UFJ. Support is a level where buy orders may be clustered. “It’s become clear the euro-yen has changed direction,” Hashimoto said. “The euro is starting a downward trend and is likely to depreciate further in the near term.” The euro rose to 126.83 yen at 7:50 a.m. in London from 126.48 yen in New York yesterday. It had earlier reached 126.09 yen, the weakest since March 16. The 124.38 yen level was last seen on March 12. Europe’s single currency has fallen 3.2 percent versus the yen this month. Daily momentum indicators such as the moving average convergence/divergence chart show a sell signal for the euro against the yen, according to data compiled by Bloomberg. MACD charts can indicate whether a price shift is a change in trend or a short-term deviation by comparing moving averages based on nine-, 12- and 26-day periods. In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index. Support is where buy orders may be clustered.

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