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EUR/JPY: Bullish engulfing candle at a key level

EagleFX

EUR/JPY produced a bullish engulfing candle at a significant level of support in the daily chart. The price has been in a bearish correction in major intraday charts. If the price produces bullish reversal candles, the buyers may look to go long in the respective charts. Thus, the pair may end up producing another bullish candle in the daily chart today.

Chart 1 EUR/JPY Daily Chart


The chart shows that the price produced a bullish engulfing candle at 120.800. The buyers may go long above yesterday’s highest high and push the price towards the North. The chart suggests that the price may find its next resistance around 124.000. On the other hand, if the price does not go above yesterday’s highest high but roams around consolidation resistance, the pair may get choppy. The sellers are to wait to look for short opportunities below the level of 120.800.

Chart 2 EUR/JPY H4 Chart


The chart shows that the price headed towards the North with good bullish momentum. It has a rejection at 121.975 and produces three bearish candles. The level of 121.500 may work as a level of support. If the level produces a bullish reversal candle, the buyers may go long above the level of 121.975. The price may find its next resistance around 122.630. On the contrary, if the price finds its resistance around 121.975 and produces a bearish reversal candle, the sellers may wait to go short below the level of 121.500. The price may find its next support around 120.850.

Chart 3 EUR/JPY H1 Chart


The chart shows that the price after making a strong bullish move had a rejection at 121.950. At the second rejection, it produced a bearish engulfing candle and headed towards the South to make a bearish correction. The level of 121.500 seems to be working as a level of support. It has produced a doji followed by a bullish engulfing candle. The buyers may go long in the pair at its weakness and push the price towards the level of 121. 950. The price may consolidate around the level of 121.700. If the level produces a bearish reversal candle, the sellers may wait to go short below the level of 121.500. The price may find its next support around 121.200.

All these three charts look good for the bull. As far as the risk-reward ratio is concerned, the H1 and the H4 chart look extremely good. Thus, the H1 and the H4 chart traders may hold their partial position and push the price towards the North in a hurry. This may make the pair create good bullish momentum in the daily chart in the end.

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