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EUR/JPY Candlesticks and Ichimoku Analysis

    •    Last Candlesticks pattern: Window
    •    Time of formation: 24 April 2017
    •    Trend bias: Up

    •    Last Candlesticks pattern: Hammer
    •    Time of formation: 18 May 2017
    •    Trend bias: Up

EUR/JPY – 134.00


The single currency has continued moving higher throughout this week after breaking above previous resistance at 132.01, adding credence to our bullish view that recent upmove is still in progress and may extend further gain to 134.55-60, then 135.00, however, near term overbought condition should limit upside to 136.00-10 and reckon 136.90-00 would hold from here, price should falter well below 138.45-50 (1.618 times extension of 109.49-124.10 measuring from 114.85), risk from there has increased for a much-needed correction to take place next month.

On the downside, whilst initial pullback to 133.65-70 cannot be ruled out, reckon support at 133.26 would limit downside and bring another rise later. Below previous resistance at 133.09 would bring correction to 132.35-40 and then test of the Tenkan-Sen (now at 132.06) but only a daily close below this level would suggest a temporary top is possibly formed, bring retracement of recent rise to 131.40-50 and possibly towards the Kijun-Sen (now at 130.87) but previous support at 130.62 should remain intact. 

Recommendation: Buy at 132.50 for 135.00 with stop below 131.50.

On the weekly chart, after last week’s rally to 133.09, the single currency has moved higher again this week and another white candlestick looks set to be formed, adding credence to our bullish view that the erratic upmove from 109.49 (2016 low) is still in progress for gain to indicated upside target at 134.40 (61.8% Fibonacci retracement of entire fall from 149.79-109.49), then 135.00, however, reckon upside would be limited to 136.00-10 and 136.95-00 should hold, price should fatter below 138.45-50 (1.618 times extension of 109.49-124.10 measuring from 114.85), bring retreat later.

On the downside, expect pullback to be limited to 132.38 support and bring another rise to aforesaid upside targets. Below said support would bring minor correction to 131.90-00, then 131.40-50 but a weekly close below the Tenkan-Sen (now at 130.87) is needed to suggest a temporary top is possibly formed, bring test of 130.62 support, only a drop below this level would add credence to this view and signal retracement of recent upmove has commenced for further decline to 128.90-00, then towards 128.00-10 but previous support at 127.56 should remain intact.

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