Good evening team,
Markets are stretched to the extreme levels as the bullish sentiment continued throughout last week.
Todays session has been relatively calm with markets consolidating after the unexpected unemployment numbers on Friday night.
The EURJPY has reached a key level on the weekly time frame and has formed a reversal candle on the daily time frame.
EURJPY – Weekly charts
The market has potentially created a head and shoulders formation. This is a very big ask to play out, there would need to be some extremely negative news come to the forefront to push the market below the neck line. However the 124.00 level appears to be a key resistance zone providing us an opportunity to add short positions.
We will look to take this set up down in stages.
EURJPY – 4 Hour Charts
Trade Setup: SELL EURJPY – Market Execution (current price 123.30), stop loss 124.55 and take profit 121.00
Stop loss: 125 pips
Take profit: 230 pips