EUR/JPY Assessment

The EUR/JPY pair fell at the very beginning of the European session with 80 pips, and it is currently at 120.20. I don’t think that it is very likely for the pair to find local support at 120.40 – 120.50 and to form a corrective pattern above it.

Despite that, considering the two spinning top bars that have gathered below the daily support at 121.00, I think that the possibility for the pair to continue falling remains valid.

My expectation is that the pair will test the last local low at 119.30, which is a strong support level visible on the weekly time frame.

I think there is a large possibility for the pair to break below that support and to continue falling toward 118.50 or even to 118.00 and only then to begin a correction to the upside. However, we need to assess the bars and patterns that will form at that level before we make a prognosis.