I’m seeing a simple trend-following setup on the 4-hour chart of EUR/JPY.
Do you think this correction opportunity is worth taking this week?
Check out this confluence of technical levels on EUR/JPY yo!
The pair has been cruising higher inside a rising channel for a month already, and it looks like another test of support is underway.
Will the trend still be my friend on this one?Support is lookin’ pretty strong, as it lines up the 61.8% Fibonacci retracement level, 100 SMA dynamic inflection point, and former resistance around the 137.00 major psychological mark.
If this is enough to keep losses in check, EUR/JPY might find its way back up to the swing high or the channel top close to 140.50.
The correction might keep going, though, as Stochastic is on the move south and has yet to reflect exhaustion among sellers. Still, the 100 SMA is above the 200 SMA to confirm that the floor is more likely to hold than to break.
Better set wide enough stops if you’re trading this one, and don’t forget to look out for top-tier events like the BOJ decision coming out soon!
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