EURJPY – Confluence support area

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Monthly: Posted a bearish Outside Month in March. This pattern often highlights the top of a trend and the start of a new downward bias. For the last 8 months we have seen mixed results with levels close to the March Marabuzo of 132.79 (mid-point from open and close) finding sellers.

Weekly: Holds within an Expanding Wedge formation. This pattern has an eventual bias to break to the downside. Trend line support is currently located at 125.21. the measured moved target is the start of the wedge at 109.20. To the upside, 132.00 to 134.00 is a previous congestion zone.

Daily: The last wave formation to the upside can be seen in three-waves, common in corrective pattern. The last leg faced exhaustion at the 261.8% extension of 133.04 (from 127.90-129.86. This keeps the long-term focus to the downside.

Intraday (four-hours) – We have a confluence area at 128.11-127.98:

1.       261.8% extension at 128.02 from 133.13-131.18

2.       Bespoke support at 128.11

3.       Lower lows at 127.98

Although the long-term focus remains to the downside, this does offer ample risk/reward for a corrective bounce higher.

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