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EUR/JPY has rallied nicely from the 124.89 low. The rally is now in five sub-waves (in red), which makes up the first impulsive wave in black wave i. Now we should look for a three wave corrective decline, which at least should take us lower to 127.29 and likely even closer to the 61.8% corrective target at 126.72.
Resistance is now seen at 129.38 and again at 129.69. The later will ideally be able to cap the upside for renewed downside pressure.
R3: 130.05
R2: 129.69
R1: 129.38
Pivot: 128.96
S1: 128.89
S2: 128.69
S3: 128.45
Trading recommendation:
We will sell EUR at 129.30 and place our stop at 129.80. We will place our take profit at 126.95. As we are trading a correction, this is a higher risk trade.
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