Weekly
• Last Candlesticks pattern: Window
• Time of formation: 24 April 2017
• Trend bias: Up
Daily
• Last Candlesticks pattern: Hammer
• Time of formation: 18 May 2017
• Trend bias: Up
EUR/JPY – 130.31
As the single currency has maintained a firm undertone after recent rally to 130.77, adding credence to our bullish view that medium term rise from 109.49 low is still in progress, hence upside bias remains for this move to extend further gain to 131.50-60, then 132.00-10, however, loss of near term upward momentum should prevent sharp move beyond previous resistance at 132.33 and reckon 133.00-10 would hold from here, risk from there has increased for a correction to take place later.
On the downside, whilst initial pullback to the Tenkan-Sen (now at 129.59) cannot be ruled out, reckon downside would be limited to 128.90-00 and bring another rise later. A drop below support at 128.49 would defer and suggest a temporary top is possibly formed, bring test of 128.00, break there would add credence to this view, then retracement of recent upmove would take place for test of previous support at 127.44 and then test of the Kijun-Sen (now at 127.31) which is likely to hold of first testing, bring rebound later.
Recommendation: Buy at 128.90 for 131.50 with stop below 127.90.
On the weekly chart, as the single currency has continued trading with a firm bias after resuming recent major upmove from 109.49 low, reinforcing our bullish view for this medium term rise to extend further gain to 131.00, then 131.50-60, however, overbought condition should limit upside to previous chart resistance at 132.33 and reckon 133.00-10 would hold from here, risk from there is seen for a retreat to take place later.
On the downside, although initial pullback to 129.50-60, then 128.90-00 cannot be ruled out, reckon 128.50-60 would limit downside and euro shall head north again from there to aforesaid upside targets. A drop below support at 127.81 would defer and risk test of the Tenkan-Sen (now at 126.59) but a weekly close below there is needed to signal a temporary top is formed, bring retracement of recent upmove to previous resistance at 125.82 (now support) but downside should be limited to 125.00 and reckon 124.00-10 would remain intact.
