EURJPY bouncing off 126.750 highs of 2019. Intraday distribution to target the next key short-term levels before possible expansion.
- Price well above the 200 EMA but looming to revert to the average.
- Price holding below 23.6 % Fibonacci from prior range (28th Aug Low to 31st Aug High)
- Correction of current range to test 61.8% which coincides with multi-month trend line AND 200 EMA
Support – 126.50, 50 EMA, 125.800
Resistance – 126.750, 126.840
Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.
Optimal Entry – 126.600
Supporting Entry – 126.400 – 126.500
Candle Reversals for entry
- Bearish Shooting Star
- Bearish Engulfing
- Bearish Dark Cloud Cover
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 above level 126.800 and violates 2019 highs – 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 126.600 – Target 1 – 125.800 = 3.2x Reward to Risk
Supporting Entry 126.500 – Target 1 – 125.800 = 2x Reward to Risk