EUR/JPY sold down into the 61.8% Fibonacci and buyers came in to support price at 123.160 zone which was prior resistance.
EUR/JPY – Retest of 200 EMA to provide entry for long side with confirmation of bullish candle signal.
- Daily – Price above 200 EMA
- Daily – Price below 50 EMA – Strong resistance so caution
- Daily – RSI broke trend line and looking to pierce 50 mid-point
- Above 200 EMA
- Above 50 EMA
- Price recovery at 61.8% of last range powering through to reclaim 200 EMA
Support – 123.530, 50 EMA, 200 EMA
Resistance – 124.240, 124.500
Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.
Optimal Entry – 123.545
Supporting Entry – 123.680
Candle Reversals for entry
As traders, it is your job to mitigate the risk and only trade structures that provide high probability and great reward to risk ratios.
If you are not comfortable with defined exit levels, experiment with Moving Averages to help set solid exit rules to protect your capital.
IF: Price breaks below 123.238– this would suggest the structure is not in our favour and would be wise to reduce exposure or close the trade until a solid signal gives us reasons to re-enter.
Reward / Reward Targets:
Optimal Entry 123.545 – Target 1 124.240 = 2.8x Reward to Risk
Optimal Entry 123.545 – Target 2 124.500 = 3x Reward to Risk
Supporting Entry 123.680 – Target 1 124.240 = 1.2x Reward to Risk
Supporting Entry 123.680 – Target 2 124.500 = 1.7x Reward to Risk