The EUR/JPY was trading with a bearish bias, holding within a downward channel which extended resistance at 121.500 level. Closing of candles below 121.500 level suggested selling bias, but recently the sentiments seem to have changed.
Previously, the pair took a bearish turn in the wake of the negative Eurozone macroeconomic data, which was involved in the EUR/JPY pair’s downfall. Besides, the rising concern of coronavirus cases from the US and all over the world were increasing safe-haven appeal, driving selling trend in the EUR/JPY pair.
The Chinese stock market surge spread to global equities and made the US dollar strong across the market. Shanghai stocks jumped 5.7% in a day after the state-owned China Securities Journal published that investors should look forward to a healthy bull market prospects. Strong JPY dragged the EUR/JPY pair further to the downside after global equities fell.
Things were going in our favor until the pair violate the downward channel at 121.500 level, and that’s when we decided to close our below trade in a loss in order to avoid additional loss. Fortunately, we made more profit in our EUR/USD trade. Let’s wait for the next opportunity now.
Entry Price – Buy 121.16
Stop Loss – 121.56
Take Profit – 120.76
Risk to Reward – 1
Profit & Loss Per Standard Lot = -$375/ +$375
Profit & Loss Per Micro Lot = -$37.5/ +$37.5
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