Technical outlook and chart setups:
The EUR/JPY pair had bounced off the 131.50/60 levels yesterday, and has now formed an engulfing bullish candlestick pattern in the daily chart. This indicates that the next big move is expected on the higher side, potentially above the levels of 139.00. Please note that 131.50/60 is also the Fibonacci 0.618 support of the entire rally from 126.00 to 141.00. It is strongly recommended to remain long from here with risk below 131.50. Immediate support is seen at 131.50/60 (interim) followed by 130.00, 129.00 and lower, while resistance is seen at 137.00 followed by 138.00/139.00 and higher.
Trading recommendations:
Remain long with stop at 131.20, a target is open.
Good luck!
