Hi Traders! EURJPY forecast update and follow up is here. On September 1st I shared this EURJPY Technical Analysis And Forecast post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club. Spoiler alert – free memberships are available!
My Idea
On the H1 chart, based on the Heikin Ashi candles we can see that currently, we have strong bullish bodies in upward moving market conditions so it basically reflects a bullish environment. Also, the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows, we may consider this as another evidence of bullish pressure. Generally, after a bullish trend pattern, we may expect corrections and then potential continuation higher. Currently, it looks like a correction is happening, also we had two strong resistance zones that has formed and the price which was moving higher has broken above these zones and is holding above them. After the breakout these strong resistance zones are acting as two strong support zones for us. Until both these strong support zones shown in the image below(marked in green) holds my view remains bullish here and I expect the price to move higher further.
EURJPY H1(1 Hour) Chart Current Scenario
On the H1 chart, based on the above-mentioned analysis my view was bullish here and I was expecting the price to move higher further after pullbacks until the two support zones hold. The price action followed my analysis exactly as I expected it to here, the pullback that I was looking for happened with the price reaching the first strong support zone, respected it and bounced higher from this zone. Also, there were no signs opposing this bullish view. The price then moved higher further as I expected it to and delivered around 700 pips move to the upside until it was blocked by a bearish divergence.
On the M15 chart, the market provided us with various facts supporting the bullish view. The price which was moving lower created a bullish divergence between the first low that has formed at 138.944 and the second low that has formed at 138.685 based on the MACD indicator. In addition to this, the price then moved higher and broke above the most recent downtrend line. We may consider these as facts provided by the market supporting the bullish view. Then as you can see in the image below how the price moved higher after that and provided an excellent move to the upside.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted to us and took the right action according to that.
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If you have any further questions, don’t hesitate to drop a comment below!
Happy Trading!
Arvinth Akash
Traders Academy Club Team.
