Euros weakness had been affecting the pair with losing bullish strength and not being able to provide a legitamate breakout by taking an exit from our bearish channel. The market in daily after completing its bearish correction, thought to have activated bullish correction now because the bearish correction of higher degree turned into a dovish rally of 5 wave impulsive structure. Current market conditions ought to have initiated its first wave 'a' of bullish correction and then in shape of a reversal - came down to retest the upper trend line of our bearish channel. Though EURJPY has taken an exit from our bearish channel in four hourly chart but still needs alot of momentum to push higher. According to our analysis published on 30th July, we gave a selling signal on the pair anticipating that Euro versus Japanese Yen will be taking a reverse from the 130.50 and continue its main bearish trend by reaching firstly to levels of our weekly lows i.e  128.38, but now observing the current market structure, the pair took a bullish reversal after a retest from 129.20 and missed our targeted destination from a few pips. 131.0 is a major price action level which acted as the first bearish breakout zone creating higher lows in June and the market makers might find some excuse to drive the pair upto that level as a decisive move or a higher degree of bullish corrective structure with wave 'c' ending at the aforementioned level.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

 If retail traders are willing to go bullish on the pair, Euro versus Japanese Yen has entered the ichimoko cloud and is in no trade zone until 130-130.20 price action is broken. Its trading below our 61.8% fibb level again and also caught by the hook of exponential moving average 50 in four hourly chart. There can be chances of EURJPY moving back down towards 50% fibb level but that would require a bearish impulsive fractal confirmation by breaking below 129.20. But the current market structure is having more of a bullish momentum to go for completing wave 'c' towards 130.50-131.40. Also keep in mind that the dollar strength might become a minor reason for hawkish sentiments in pushing EURJPY higher.

EURJPY H4

Aug 05 2021