EURJPY – Daily cloud base offers strong support and may contain broader bear-leg from 124.08
|EURJPY
Yesterday's strong downside rejection after brief probe below daily cloud base (118.89) left daily candle with very long tail that generates initial signals of stall of bear-leg from 121.26 (15 Feb lower top). Base of thick daily cloud acts as strong support which should ideally contain correction of 112.59/124.08 upleg, ahead of fresh attempts higher. The notion is supported by reversal of slow stochastic from oversold zone on daily chart, as well as oversold conditions on weekly chart. While daily cloud base is holding, initial signals of reversal could be expected. However, scenario requires bounce above first pivot at 119.92 (daily Tenkan-sen) to sideline downside risk and signal further recovery. Conversely, break below daily cloud could trigger fresh bearish acceleration towards next strong support at 117.67 (200SMA).
Res: 119.71; 119.92; 120.20; 120.68
Sup: 119.24; 118.89; 118.58; 118.33
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