Trade of the Day: EUR/JPY
By: Dima Chernovolov
EUR/JPY continues to fall inside the clear 15-minute Falling Wedge chart pattern which was recently identified by Autochartist. Autochartist rates the quality of this Falling Wedge at the 5-bar level – which is the result of the slow Initial Trend (2 bars), average Uniformity (5 bars) and strong Clarity (8 bars). EUR/JPY expected to fall further inside this Falling Wedge chart pattern – in line with the earlier breakout of the support area shown below.
As can be seen from the daily EUR/JPY chart below – the pair earlier broke through the support area lying between the key support level 119.40 (monthly low from November) and the 50% Fibonacci retracement of the previous upward price impulse from September. This price area is acting as the resistance zone after it was broken. The proximity of this resistance area adds to the probability EUR/JPY will continue to fall inside this Falling Wedge.