EUR/JPY Technical Analysis - longer-term bullish formation
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, 06-01-2017 at 06:55 PM (838 Views)
The net of the past three weeks of price action in EUR/JPY has been a rather chaotic range near the top of a well-developed bullish move. So, while near-term price action has taken on a bearish tonality, the longer-term formation here is still bullish in nature. Nonetheless, price action remains very close to the top of that longer-term bullish formation, and traders may want to look for a deeper retracement before adding bullish exposure with longer-term time horizons. There are two potential zones to watch for such an indication; with ‘S1’ showing between 121.62-121.96, while ‘S2’ straddles the 120.00 psychological level (119.91-120.32).
For shorter-term bearish strategies, we’re at an interesting area of potential resistance. We had looked at 124.50 as a ‘line of demarcation’ in our previous article, and this area continues to elicit interest. This area had given a brief element of resistance before the bearish move extended after this week’s open; and taking a Fibonacci retracement around this most recent bearish move shows the 50% marker at 124.62. This can open the door to short-side swings with stops above 124.78 or 125.00, with targets cast towards 123.75 and then a re-test of prior lows at 123.22.
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