All-in-all, price rejecting the 50 Exponential Moving Average, and is in favor of the uptrend.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
This analysis was done on MetaTrader 4.
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EUR/JPY symbol on the MT4 platform
Key support levels: 125.25, 124.27
Key resistance levels: 125.60, 125.38
The major trend for the EUR/JPY remains bullish, although we might be seeing the beginning of a trend reversal, considering the bounce off the 161.8% Fibonacci retracement level back on the August 17. It is located at 126.38, and have been used as a second point to draw a downtrend trendline. While the uptrend trendline was rejected, the downtrend trendline was broken, suggesting yet another, and perhaps the final wave to the upside.
Currently, price rejecting cleanly 61.8% Fibs, applied to the downtrend trendline breakout point. Therefore, as long as 4h close remains above 125.14 support, the price should be expected to move up. However, the most recent high at 125.60 has to be broken, with the 4h close above, in order to confirm the upside wave.
All-in-all, price rejecting the 50 Exponential Moving Average, and is in favor of the uptrend. On the other hand, there are no clear confirmations either on the uptrend or a downtrend. Watch for the 4h close above the 125.60 resistance or below the 125.24 support in order to understand the probability of either an uptrend or a potential trend reversal to the downside.
4H break and close above the resistance should send price towards 161.8% Fibs at 126.40, while break and close below the support could be the confirmation of a trend reversal or at least a strong correction to the downside. For now, it looks like a consolidation phase.