After being involved in a nice shorting opportunity on FX:EURJPY , there are key signs of reversal emerging on the 4 hour chart. The first sign is the harmonic move completing right at the potential reversal zone (PRZ), with several and retracement levels ( Zone). Next sign of reversal is the completion of bullish pattern at 161.8% Fib extension level, which is located within the PRZ. I usually place my stops several pips below the PRZ but since this zone is right at previous (looking left), we should consider putting our stops below that . The first target at 38.2% level is located right at structure level, so we should definitely consider taking some profit off at that level.
It’s totally up to you guys on how you want to enter into this trade setup, either via pattern or the pattern. The stop loss and the targets will remain the same for both patterns, regardless of which one you choose to trade. I would personally be more interested in trading the pattern since it has the lowest risk involved. We are also noticing bullish divergence on the MACD, which adds into our list of reasons for going long on this pair.
Please feel free to AGREE or DISAGREE with this idea by leaving a comment below. Hit that thumbs up button (top left corner of this chart) if you like the idea. Thank you everyone for all the SUPPORT that you have given me so far, I truly appreciate it. Good luck everyone :)
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