Last Candlesticks pattern: Hammer
Time of formation: 19 Sep 2016
Trend bias: Down
Last Candlesticks pattern: Doji
Time of formation: 28 Mar 2017
Trend bias: Near term up
EUR/JPY – 124.16
Although the single currency extended recent upmove to as high as 125.82 earlier this week, lack of follow through buying and the subsequent retreat suggest consolidation below this level would be seen with initial downside bias for correction to 123.00, then 122.55-60, however, reckon 121.60-65 (38.2% Fibonacci retracement of 114.85-125.82) would limit downside and bring another rise later, above 125.05-10 would bring retest of 125.82 but break there is needed to signal recent upmove has once again resumed and extend subsequent gain to 126.50-60.
On the downside, whilst initial pullback to 122.90-00 and then 122.55-60 cannot be ruled out, reckon downside would be limited to 121.60-65 (38.2% Fibonacci retracement of 114.85-125.82) and bring another upmove later to aforesaid upside targets. Below indicated previous support at 120.60 would abort and signal a temporary top has been formed, bring retracement of recent entire rise to 120.30-35 (50% Fibonacci retracement) and then 120.00 but reckon downside would be limited to 119.40-50 and price should stay above indicated support at 118.92, bring rebound later.
Recommendation: Buy at 121.60 for 124.60 with stop below 120.60.
** For daily trade ideas on EUR/JPY, please refer to the Elliott Wave Daily section.
On the weekly chart, as the single currency has retreated after rising to 125.82, suggesting minor consolidation below this level would be seen and pullback to 123.00, then 122.00 cannot be ruled out, however, reckon 121.60-65 (38.2% Fibonacci retracement of 114.85-125.82) would limit downside and bring another rise later, above 125.00 would bring retest of said resistance at 125.82 but break there is needed to confirm the erratic rise from 109.49 has resumed for retracement of medium term downtrend to 125.25-30 (50% Fibonacci retracement of 141.06-109.49) but reckon upside would be limited to 126.00 and 126.45-50 would hold from here.
On the downside, although initial pullback to 122.90-00 and possibly test of the upper Kumo (now at 122.04) cannot be ruled out, reckon downside would be limited to 121.50-60 and bring another rise. Only below support at 120.60 would defer and risk weakness to the Kijun-Sen (now at 120.34) and then 120.00 which is likely to hold on first testing. Looking ahead, euro needs to penetrate indicated support at118.92 to shift risk to the downside for further fall to 118.00, however, downside should be limited to previous resistance at 117.82 and bring rebound later. A weekly close below 117.82 would suggest first leg of rebound from 114.85 has ended, bring weakness to 117.00 but price should stay above 116.20-25, bring another rebound later.
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