EURJPY rebounded from 127.56 after touching the bottom support trend line of the price channel on the daily chart, suggesting that the pair remains in the uptrend from 114.85. As long as the price is in the channel, the fall from 131.39 could be treated as consolidation of the uptrend.

On the upside

Near term resistance is located at the descending trend line from 131.39 to 130.39 on the 4-hour chart, now at around 130.00. A clear break above the trend line resistance could take price to next resistance level at 131.39, above this level will confirm that the bullish movement from 114.85 has resumed, then next target would be at 133.50 area. The 133.50 level should be the final target of the uptrend.

On the downside

As long as the EURJPY pair is below the bearish trend line on the 4-hour chart, the downside movement could be expected to continue and further decline to test 127.56 support is possible. The 127.56 level is acting as the key support of the bullish movement from 114.85, below this level could signal completion of the uptrend, then the pair would find next support level at 125.80, followed by 122.40. The final target for the downside movement would be at the 61.8% Fibonacci level, taken from 114.85 to 131.39, at around 121.20.

Support levels: 127.56 (key support), 125.80 (the May 16 high), 122.40 (the June 15 low), 121.20 (the 61.8% Fibonacci support).

Resistance levels: 130.00 (the descending trend line on the 4-hour chart), 131.39 (the August 2 high), 133.50 (the final target of the uptrend).

This article is written by Franco Shao, a senior analyst at ForexCycle.

© 2017 Copyright Franco Shao - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.