There was no time for a bounce back to 129.85 before the final decline towards the 38.2% corrective target at 128.22. EUR/JPY retested short-term important resistance at 129.14 and then dropped off towards the 38.2% corrective target. It did not quite make it to the low of 128.22, but bottomed at 128.30, which is sufficient to complete red wave (2) and set the stage for a new impulsive rally towards 130.87 on the way higher to 131.99 and ultimately above the February peak at 137.50.
Support is now seen at 129.14, which ideally will be able to protect the downside for a break above 129.85 confirming a retest of 130.87 on the way higher.
R3: 130.87
R2: 130.22
R1: 129.85
Pivot: 129.50
S1: 127.14
S2: 128.91
S3: 128.55
Trading recommendation:
We are long EUR from 129.10 and we will move our stop higher to 128.25. If you are not long EUR, buy near support at 129.14 and use the same stop at 128.25.
