Wave summary:
Much to our surprise EUR/JPY failed to break above resistance, seen at 121.86, and has instead broken below support at 120.61 keeping the corrective decline from 122.88 alive. The next downside support to look for is seen at 119.99, which marks both the 61.8% corrective target of the rally from 118.19 to 122.88, but also the low of wave iv/ of one lesser degree, which should provide substantial support. That said, we have to be aware the JPY now is benefiting from the risk-off mode due to the stock markets sell-off yesterday and we can underestimate this fear. So we will need some solid proof, that the corrective decline from 122.88 has completed and the best will be a break above 121.84.
R3: 121.84
R2: 121.12
R1: 120.59
Pivot: 120.00
S1: 119.99
S2: 119.81
S3: 119.48
Trading recommendation:
Our stop at 120.50 was hit for a small loss. We will step aside for now waiting for clues of this correction being complete.
