Trade of the Day: EUR/JPY
By: Dima Chernovolov
EUR/JPY continues to fall inside the daily Descending Triangle chart pattern which was previously identified by Autochartist. Autochartist rates the quality of this Descending Triangle at the 6-bar level – which is the result of the strong Initial Trend and Uniformity (8 bars). EUR/JPY is expected to fall further inside this Descending Triangle – in line with the earlier downward reversal from the resistance area shown below.
As can be seen from the daily EUR/JPY below, the price earlier reversed down from the resistance area lying between the pivotal resistance level 127.00 (former monthly low from September), upper daily Bollinger Band and the 61.8% Fibonacci correction of the downward impulse from September. The proximity of this resistance area increases the probability EUR/JPY will continue to fall inside this Descending Triangle.