FX.co ★ Technical analysis of EUR/JPY for January 26, 2015

General overview for 26/01/2015 12:20 CET

According to the latest weekly analysis published on last Friday indicating important changes in overall Elliott wave labeling (You can read more here: /en/analysis/55962/), we will now continue the analysis of the alternate scenario.

As it was anticipated last Friday, the market has hit the 131.05 level and now is bouncing back to the upside. This bounce might still be a part of the corrective cycle in the wave 4 blue, possibly in a shape of a triangle pattern, but any breakout higher above the level of 138.75 would indicate that the bottom for the wave 5 blue is in place. Nevertheless, on intraday time frames the market is still trading in the bearish zone and below the weekly pivot at the level of 132.95. Only a sustained breakout above the intraday resistance at the level of 134.19 would open road to test the level of 137.63. Otherwise a choppy trading conditions are expected.

Support/Resistance:

128.22 - WS1

130.14 - Swing low

131.83 - Intraday Support

132.95 - Weekly Pivot

134.19 - Intraday Resistance

134.95 - WR1

137.63 - Technical Resistance

Trading recommendations:

As long as the price stays below the level of 134.19, choppy trading conditions are expected, and daytraders should consider to open only a sell orders with SL just above this level, using any scalping strategy to gain 20-30 pips.