A downward correction can continue.

On the 4-hour chart, the price rebounded from the level of 135.75 (61.8% Fibonacci correction) and reached the level of 134.83 (38.2% correction). At present, the likely scenario seems to be the fall continuation towards 134.26 and 133.64. However, if the price breaks out the level of 134.83 a growth could resume to the levels of 135.28 (50% correction) and 135.74 (61.8% correction). On the daily chart, the price tested strong resistance level at 135.74 (overlap of the short-term and medium-term corrections) but could not overcome it and is now trading near the level of 134.65 (23.6% correction). If this level gets broken down, the pair could fall to 133.64. Otherwise, it could grow and retest the level of 135.74.

Trading tips

Short positions are preferred. These can be opened from the level of 134.65 with targets at 134.26, 133.64 and stop-loss at 134.90.

Alternative scenario

Long positions can be opened after the price consolidation above the level of 134.83 with targets at 135.28, 135.74 and stop-loss at 134.70.

EUR/JPY: Fibonacci analysis

EUR/JPY: Fibonacci analysis

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