Trade of the Day: EUR/JPY

By: Dima Chernovolov

EUR/JPY continues to fall inside the 4-hour Down Channel chart pattern, which was recently identified by Autochartist. Autochartist rates the quality of this Down Channel at the 7-bar level – which is the result of the slow Initial Trend (3 bars)  and strong Uniformity and Clarity (8 bars). EUR/JPY is expected to fall further inside this Down Channel.

As can be seen from the daily EUR/JPY chart below – the price earlier reversed down from the resistance area located between the key resistance level 130.40 (which has been reversing the price from July), upper daily Bollinger Band and the 38.2% Fibonacci correction of the downward impulse from June. The proximity of this resistance area increases the probability EUR/JPY will continue to fall inside this Down Channel.