? EUR/JPY Bearish Impulse Creates Wave 3 Pattern ?

3 min read

Hi traders,

the EUR/JPY made a bearish reversal at the resistance trend line (red), which indicates that a larger bearish retracement is now likely via a WXY (purple) pattern within wave 2 (pink).

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The EUR/JPY will probably test the Fibonacci levels of wave 2 vs 1, which are expected to act as potential support. A break below the 100% Fibonacci level would invalidate the current wave 1-2 (pink) outlook whereas a bullish break above the resistance trend lines could confirm the end wave 2 (pink) and start of wave 5 (purple).

4 hour

The EUR/JPY has made a bullish ABC (blue) zigzag within a wave X (purple) after price broke below the multiple support trend lines (dotted green). The bearish impulse is probably a wave 3 (green) which means that the current pullback could be a wave 4 (green), which typically sees a shallow retracement towards the 23.6-50% Fibonacci levels. The next push could complete a wave 5 (green) within wave A (blue), after which a wave B/C (blue) still remains.

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Good trading,
Chris Svorcik
Elite CurrenSea

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