EUR/JPY has corrected a bit higher than expected but it does not change our view. More downside pressure towards 119.26 should be seen before the correction in wave 2 has completed and a new rally can begin. In the short-term, we will be looking for a break below minor support at 121.18 to confirm the ongoing correction from 120.14 has completed and the final dip lower to 119.26 is unfolding.
At 119.26 EUR/JPY will have corrected 50% of the leading diagonal in wave 1 and will at the same time test the bottom of wave iv of one lesser degree which is a very common target for corrections.
R3: 122.03
R2: 121.76
R1: 121.46
Pivot: 121.18
S1: 120.88
S2: 120.68
S3: 120.44
Trading recommendation:
We sold EUR at 121.20 and has placed our stop at 122.20.