The EURJPY broke an important resistance level and it will probably head to the next LT resistance level. If we take a look at the weekly chart, we’ll see the it has a long way to go before the market hit the next 1W resistance level:
You got to be careful though, keep in mind that we are talking about the weekly chart and it could take a while before the market hits this resistance level. I would say at least two weeks, but If you trade the long term charts, I would recommend you to look for long trade opportunities (in your own risk of course).
Even though the EURJPY retraced from 132.59 to 131.82, it is still in a bullish market condition. It broke an important short term resistance level during the European session, so I’ll be looking for a long trade opportunity:
Here is my trading plan:
As long as the EURJPY trades above 131.90 I will be looking for long trade opportunities. My next LT resistance level is at 135.20 (we could see some resistance around 134.30 though).
If the market breaks the 131.90 down, I will be in the sidelines.
Sometimes it’s good to have a look at the weekly and monthly charts to have a better idea of where the market is heading. Take a look at the EURJPY weekly chart:
In this chart, it is clear that the market is ranging in between the main support & resistance area. But what is more important is “how” the market behaves when it gets close to the main support area, it gets rejected with strength. This gives us a good idea of where the EURJPY is heading, probably in the next weeks it will het the main resistance area, which is 600 pips from where the market is trading now.
Of course we’ll need to use the short term charts to pinpoint our entry (this way we´ll get a good risk reward ration).
The EURJPYtraded for a few days in a range in between 132.78 and 134.40, it was a pretty defined range, but it only had around 160 pips in between, making it hard to find good swing trades. However, theEURJPYalready broke the top of that range. Take a look at the next chart:
It is trading above that range and it will probably continue its way up until the next long term resistance level is reached.
My Trading Plan:
As long as the EURJPYkeeps trading above 134.40 I will be looking for long opportunities and will target the next resistance level around 137.42.