The performance of our beloved EURJPY in the month of August was dismal to say the least. Yet there in lies the beauty of FX trading. Be it a show in weakness or strength of the EURJPY, Tflow® students would be ready to pocket the gains from low risk trades. Because the question is: Are you merely a gambler or a conscious investor?
On the Daily chart, a new 2010 was reached in the second half of August. Towards the end of August, this low was tested again and as a result, a strong support zone for the EURJPY was found. With the continuation of the downtrend of the EURJPY in the month of August, what would September bring? The EURJPY is currently trapped between intermediate levels of support and resistance (White horizontal lines).
Resumption of the downtrend in August
On the H4 chart, the borders of the upward equidistant ED channel we drew last week have been shifted to accommodate the price action of Week 35. Nevertheless, the EURJPY appears to continue in an upward. Fashion. In early Week 35, price came down to test the support zone of the previous week. Having successfully bounced off the support level (Lower Green Horizontal line), price retraced to test its own high of the week. The high of Monday Week 35 proved to be a strong resistance too (Higher White Horizontal line).
Now with price resting in the middle of no man’s land (In the middle of the ED channel and at the mid-week level of Week 35) price can really go either way. Just to remind ourselves, the general direction of the EURJPY is still down.
EURJPY Price Trapped in No Man’s Land
Going into Week 36, here is what we can look forward to:
a) Bulls will continue its momentum up (Blue arrow) the blue ED channel, should they succeed in overcoming the immediate resistance (Upper White horizontal line). There is an area of confluence made by the upper border of the ED channel and a down-sloping trendline.
b) Bears (Red arrow) will be also be equally enthusiastic in shorting our beloved EURJPY down to a potential confluence of support arising from the lower border of the ED channel and midweek level of Week 34 (Upper Green Horizontal line).
The upcoming week will be tricky. Yet either way, Tflow® students will be ready to fine tune our entries in the lower time frame, to follow where the market lead us to!
And the Doctor’s Advice for the Week: Remember to look for areas of confluence; for price would likely be ‘lured’ towards these areas.
To find out more, you can join our free forex seminar where we are going to showcase Tflow®.
