EUR/JPY: technical analysis 27.12.19
On the 4-hour chart, the instrument is growing along the upper line of the Bollinger Bands and is approaching the strong resistance 121.875. There is a high chance of a downward rebound, while its breakout will let the price to grow to the resistance area of 122.150-122.266.
The downward rebound from 121.875 resistance and pullback below the 121.700 will be a sign of downward correction formation and give a prospect of decline to 121.563 support.
The downward trend will be restored after the price is set below the level of 121.370, which is the middle line of Bollinger Bands. In this case, the next targets of sellers will be the level of 121.094.
Technical indicators maintain 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 is in the oversold area and is pointed downwards, reflecting the high possibility of the downward correction formation.
Support and resistance
Support levels: 121.700, 121.563, 121.370, 121.094.
Resistance levels: 121.875, 122.150, 122.266.
Short positions can be opened below the level of 121.563 with the target at around 121.370-121.300 and stop-loss at 121.650.
Long positions can be opened above the level of 121.875 with the target at around 122.150 and stop-loss at 121.783.