EUR/JPY: technical analysis 01.05.20

Current trend

EUR/JPY is in the stage of a downward correction after growing to the level of 117.767. At the moment the price has met the support at the level of 117.126. The breakdown of this level and a sustained move below it will be a sign of the downward correction development and let the price decline to the 116.797 support. These level might offer an intermediate halt during the plunge to key correction target around 116.406-116.200.

Alternative scenario

The upward rebound from 117.126 and pullback above 117.357 resistance will let the price re-test the area 117.504-117.578 resistance. One may speak about upward movement continuation after the price consolidates above the resistance level of 117.767. In this case, the buyers will aim for the 117.969 area.

Technical indicators

Technical indicators mostly keep a buy signal, but the downward correction is possible in the short term.

Bollinger Bands are diverging on the background of bullish momentum.

MACD is growing in a positive zone.

Stochastic has left the overbought area and is pointed downwards, reflecting the high possibility of the downward movement formation.

Support and resistance

Support levels: 117.126, 116.797, 116.406.
Resistance levels: 117.357, 117.504, 117.767, 117.969.

Trading recommendations

Short positions can be opened below the level of 117.126 with the target at around 116.797 and stop-loss at 117.235.
Long positions can be opened above the level of 117.767 with the target at around 117.969 and stop-loss at 117.690.

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