EUR/JPY is set to test the neckline resistance at 125.17. A break above here will call for a continuation towards the former peak at 127.02 and likely even closer to resistance at 129.06. We currently see a nice S/H/S bottom with a neckline at 125.17 dominating the short-term picture and in our view, it is only a question of time before the neckline resistance is broken and the next impulsive rally is triggered for a re-test of the former peak at 127.02.
Support is currently seen at 123.87 and then at 123.54.
R3: 125.50
R2: 125.17
R1: 124.75
Pivot: 124.22
S1: 123.87
S2: 123.54
S3: 123.20
Trading recommendation:
We are long EUR from 123.46 with our stop placed at break-even.