EUR/JPY Price Analysis: Bears seeking an extension to channel support
|- EUR/JPY bears lining up for an opportunity to test channel support.
- EUR/JPY otherwise trapped between daily support and resistance.
As per the start of the week's analysis, EUR/JPY Price Analysis: Bears seek break of daily support, bulls anticipate monthly higher-high, the cross is consolidated between support and resistance still.
However, there could be an opportunity for traders within the channel and the 1-hour time frame is offering prospects of a downside continuation as follows:
However, while there is clearly a bearish bias, there is plenty of structure on the lower time frames that should be considered, such as the 15-min and potentially further upside left in the correction:
In the above chart, the point of control, (POC) for the current session, is critical and may serve as a support, guarding the downside target. Therefore, bears may wish to approach such a set up at reduced risk.
However, a break of current support, for which has already happened, was enough to offer an opportunity.
A sell limit can be placed at the old support structure, 126.10, which would be expected to act as resistance on a bullish retest.
A stop-loss above the highs, 126.22, offers protection from a rally through low volume nodes into the 126.30s for a 1:2 risk to reward position.
Update: Breakeven
The position is now risk-free with a close below new resistance structure and even the POC.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.