EUR/JPY has bounced from the 125.00 area and is now at least 90 pips higher in less than 24 hours. Not the kind of volatility that we love to see from our cryptos, but that was pretty aggressive!
The upswing is taking a breather at the 126.00 major psychological handle that lines up with a range support that had been solid in December and the first half of January.
Are we looking at a break-and-retest opportunity?
Stochastic flashing an overbought sign should support the euro bears who are looking to trade a drop back down to 125.00 or even new 2021 highs in the next trading sessions.
But what if last week’s “breakout” was a fakeout? Once EUR/JPY confidently trades above 126.00 and the 100 SMA, then you should at least look into trading the range and EUR/JPY possibly hitting the 126.50 and 127.00 key range levels.
Currency crosses not your beat? Take a look at EUR/USD’s trend!
The pair is poppin’ up a potential morning star pattern on the daily time frame. And if that’s not enough to make you look twice, it also happened at a 38.2% Fib retracement!
Euro bulls who believe that the trend will continue to be friendly can buy at current levels and aim for at least January’s highs near 1.2350.
If you think that the bears can still squeeze in a couple hundred pips before the bulls take over, though, then you can wait for more candlesticks to close to see if EUR/USD would indeed bounce at the 38.2% Fib or if it will hit the 50% and 61.8% Fibs before extending its uptrend.
Copyright© ftgfx.com 2020 | All right reserved