EURJPY Weekly Technical Outlook
The EURJPY bearish drop from the 126.520 reaction zone on the weekly time frame six weeks ago has not had much follow-through as there has been some hesitation in southward momentum. The last three weeks have seen the EURJPY market operating sideways in the main, although the technicals give sellers a little edge. Presently, price action is around the 122.770 horizontal support and the market is rather ambivalent in the area.
On the daily time frame, price action is operating in a descending wedge (blue) and presently located around the wedge support trendline. However, the printing of ‘wicky’ candlesticks in the area indicates neither bulls nor bears have control of the order flow. We may have to wait for directional clarity. Should bulls gain control of price action in the early part of this week, they may find the 124.000 problematic as a resistance. But bears are likely to find the present location of price action, the 122.390 handle, which has held since the January 2019 flash crash difficult to break down. I expect a northward retracement of price action before bears can make a determined effort to break down the zone.
On the H4 time frame, last week Tuesday, price action punched through a descending trendline (magenta) from April 2019 high and role flip the former horizontal support around 123.700 as resistance. We may see such a price action in the early part of this week as the market is presently ambivalent. The 123.000 area may present itself as a target of northward retracement. Thereafter, we may have a southward turnaround.
I will stay on the sidelines from the EURJPY market for now.
I may be wrong. Trade safe and prosper.