The EURJPY price has retraced back to a key support level but will the trend continue?
In this video, we identify why we want to be a buyer and how you can find a high probability trading opportunity.
Watch the video to learn more…
Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, Head Currency Analyst.
In this video, we’re going to take a look at EUR/JPY because there could be a potential trend trading opportunity here.
So, looking at the daily timeframe here, we can see that the price is quite clearly trading in an uptrend, we have higher highs, and higher lows as the price continues to trend higher.
Now, we want to be in this market because the JP Yen is very weak at the moment, and we know that from the strength and weakness analysis.
The stock markets have been rallying, so the JP Yen has continued to gain some strength. We can see that clearly on the chart by this uptrend. I’m looking for it to continue because the price has recently come back and retested the previous structure highs.
Typically, if it’s a strong trend, we would see the market come back to previous structure highs and continue the trend higher. You can see this previous example back here, and even back down here, where price comes back into that previous structure, rallies, and continues and so on.
We’re looking for the price to continue higher here, and one thing I like to look for is the change in trend on a lower timeframe.
The four-hour timeframe is a good trend to take short-term trading opportunities on, and the reason why I like looking for the change of this trend is because it usually leads to a longer-term breakout.
We can look at the previous examples here to show us that the price down here made lower lows and lower highs until this breakout point. The price then came back, retested those structures here, and continued to the upside.
Very much the same here; the price was in an uptrend environment, changed the trend, pulled all the way back, came back in, then started to make higher highs and higher lows.
Again, we’ve got the same pattern here. The price makes lower lows, comes back into the previous structure highs – potential area for price to find support – double-bottoms, and now price is breaking trend.
What I’d like to see is if the price continues to press to the upside, look for a pullback into that previous structure point, and look for a long opportunity back into the highs.
We are looking at numbers. If the price continues to break above 1.2876, hold above this level for a couple of candlesticks. If the price comes back down into this area, look for the long or the uptrend’s potential continuation.
Suppose the price continues upside, targets are going to be the highs around 129.85. That’s a good level to look for resistance as the price found resistance there previously.
EUR/JPY, look for the potential for the daily to continue the uptrend higher, and for the four-hour change in trend. If both happens, go down to a lower timeframe and look for a strategy set up.
Thanks for watching, and I’ll speak to you in the next video.
We hope our forex chart of the day analysis helps you in your trades. Practice trading the EUR/JPY pair with free $50,000 funding when you sign up for a free demo account at Blueberry Markets.