EURJPY has been range bound for the better part of 2018.
It isn’t obvious though if you’re only viewing the last couple months of price action. Since bottoming out in late October, EURJPY hasn’t managed to do a whole lot.
In fact, since November 12th, the pair has been locked in a 170 pip range. That’s 25 trading days to put things in perspective.
But a look back to mid-February shows the beginning of a much more impressive 800-pip range.
The pair last tested the range ceiling at 133.10 in late September.
If the movement following the prior test of 133.10 in late April is any indication, the EURJPY may have another 300 pips left in this recent down move.
So what’s the plan for next week?
In my opinion, it’s going to take a daily close below trend line support in the 127.90 to 128.00 area to trigger the next leg lower.
By “daily close”, I’m referring to the New York close at 5 pm EST. Anything else can result in a false break.
Go here to get instant access to the same charts I use to trade price action.
Keep in mind that the region just above 127.50 may also attract a few buyers on the way down. 126.60 is another level to keep an eye on.
Those levels will probably only trigger temporary pauses though.
It’s pretty clear from the daily time frame that a close below trend line support would re-engage the 800-pip range that began earlier this year.
That suggests an extended move to the range floor at 125.00.
We’ll see how EURJPY reacts to support over the coming sessions. But at the moment, this appears to be a top trade idea as we enter the last couple weeks of 2018.
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