- EUR/JPY falls below a rising support trend line, giving bears an opportunity to target lower levels for a day trade.
- From a long term perspective, the cross is pressured at a supply zone.
- Bears line-up patiently for a swing trade target in the 122's awaiting an entry below 125.50.
The price of EUR/JPY has moved into a bearish situation on the 15-mn chart following a break of the support structure and a current retest for entry.
Bears may see this as an opportunity to short with a stop loss above the recent highs, (move the stop to breakeven when a new support structure is formed below entry), targeting a 1:2 risk to reward to a prior resistance structure on the 4HR time frame.
1-hour chart
-637333079032423595.png)
15-min chart, MACD turning bearish
-637333079323531921.png)
4-HR target zone
-637333079803886353.png)
Update: Breakeven achieved
The price has formed a new support structure so the trade is now a breakeven minimum:
-637333097189974963.png)
Swing trade analysis
Meanwhile, from a longer-term swing trading perspective, the price has reached a strong level of resistance and a correction could be in order.
As can be seen on the above monthly time frame, a 38.% Fibonacci retracement lines up perfectly with prior resistance which could be targetted.
-637333087247926148.png)
Nearer term, the weekly chart offers a higher risk to reward target which bears may wish to skip because there still needs to be confirmation from a lower time frame that price is going to remain bearish below important resistance structure. Let's take a look...
-637333088859200818.png)
As can be seen on this daily chart, the bears have some supporting levels to crack yet before there is a clearance below 125.50 or a more conservative 124 to target the aforementioned monthly 38.2%:
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD drops to near 1.0850, further support at nine-day EMA
EUR/USD continues to lose ground, trading around 1.0860 during the Asian hours on Friday. From a technical perspective on a daily chart analysis indicates a sideways trend for the pair as it continues to lie within the symmetrical triangle.
GBP/USD posts modest gains above 1.2650, focus on the Fedspeak
The GBP/USD pair posts modest gains near 1.2670 during the Asian session on Friday. Meanwhile, the USD Index recovers some lost ground after retracing to multi-week lows near 104.00 in the previous session.
Gold price gains ground, with Fed speakers in focus
The Gold price trades with a positive bias on Friday. The bullish move of precious metals in the previous sessions was bolstered by the softer-than-expected US inflation data in April, which triggered hope for rate cuts from the US Fed.
LINK price jumps 10% as Chainlink races toward tokenization of funds
Chainlink price has remained range-bound for a while, stuck between the $16.00 roadblock to the upside and $13.08 to the downside. However, in light of recent revelations, the token may have further upside potential.
Fed speak tempers rate cut expectations
The biggest takeaway into Friday is the latest round of Fed speak. These Fed officials reiterated their stance rates should be kept restrictive for a longer period of time until there is more clear evidence inflation is heading back towards the 2% target.