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EUR/JPY: Is the support strong enough to make a new higher high?

EagleFX

EUR/JPY produced a bullish Marubozu candle yesterday. The price after being bearish for several days produced an Inverted Hammer followed by yesterday’s bullish candle. Thus, the buyers may keep their eyes to go long in the pair. The H4 chart looks bullish as well, but the H1 chart looks good for the Bear. Let us now find out some key areas that we need to keep our eyes to trade in the pair.

Chart 1 EUR/JPY Daily Chart


The chart shows that the price made a bearish move and made found its support at 124.650. It produced an Inverted Hammer and then produced a bullish Marubozu candle. It suggests that the price may head towards the North if it makes a breakout at yesterday’s highest high. The price may find its next resistance around 126.650. On the other hand, if the price produces a bearish reversal candle, the sellers may go short below the level of 124.650. The price may find its next support at 123.000.

Chart 2 EUR/JPY H4 Chart


The chart shows that the price made a bullish move upon producing an ABC pattern. It made a breakout at the level of 125.570 and traded above the level for several candles. The price seems to have found its resistance around 126.000 and produced a bearish engulfing candle. Since the level of 125.570 still holds the price, it may end up producing a bullish reversal candle. The buyers then go long in the pair above the level of 126.000. The price may find its next resistance around 126.650. In case of a bearish breakout at 125.570, the sellers may drive the price towards the level of 124.850.

Chart 3 EUR/JPY H1 Chart


The chart shows that the price had rejection at the level of 126.000 three times. At the last rejection, it produced a bearish engulfing candle. The price has been bearish since then. A breakout below the level of 125.600 may drive the price towards the level of 125.300. On the other hand, if the level of 125.600 works as a level of support and produces a bullish reversal candle, the buyers may go long in the pair and push the price towards the level of 126.000 again.

The daily and the H4 chart look bullish biased. However, the H1 chart looks good for the Bear. Considering these three charts, it seems that the pair may end up being bullish today as well. If the candle closes above the last swing high, the pair may remain bullish in the coming days.

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