Euro versus Japanese Yen has pushed itself into an extended consolidative structure - influencing the pair to trade around the exponential moving averages 50 and 200 in daily time frame while the market defending two major supply demand zones in shape of support and resistance at 127.80 & 130.90 - 131.0 price action. EURJPY found strength based on the fundamentals supporting the euro figure - which in turn pushed the cross currency pair higher towards 130.33 on 28th Sept but our major resistance at 130.90 was left in isolation by avoiding being flirted with by EURJPY. The hawkish momentum failed to prevail the pair roaming above the exponential moving averages 50 and 200 in the daily time frame - forwarded by EURJPY falling below 61.8% fibo retracement level 129.75.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

Euro versus Japanese Yen has found support above 50% fibo retracement level 128.46 after falling below the exponential moving averages 50 and 200 in the daily as well as interday time frames while still managing to stay above our major support line 127.80. For the confirmation of continuation of bearish trend, we would require the pair to break below the aforementioned support zone with an impulsive dovish behavior. On the bullish side, the pair needs to regain the territories above 61.8% fibo level and 130.90 - 131.0 in order to confirm that EURJPY is setting grounds for higher highs on the daily chart. The extended consolidative structure - in accordance to elliot wave pattern, has not yet provided us with a 5 wave pattern after the major bearish breakouts below 131.0 and is still showing adaptation to 3 wave structure. So our trades will be determined based on a clear and precise breakout from the level mentioned. 

EURJPY in an extended consolidation

Oct 07 2021