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Monitoring The Bearish Engulfing Candle

  • RES 4: 129.47 1.00 proj of the Jun - Aug - Oct 2020 price swing
  • RES 3: 129.26 High Dec 13, 2018
  • RES 2: 128.59 High Dec 17, 2018
  • RES 1: 128.46 High Feb 17 and bull trigger
  • PRICE: 127.63 @ 16:21 GMT Feb 22
  • SUP 1: 127.31 Low Feb 17
  • SUP 2: 127.04 Low Dec 15
  • SUP 3: 126.40 50-day EMA
  • SUP 4: 126.10 Low Feb 4

The EURJPY broader outlook remains bullish despite Monday's pullback. Despite this, last Wednesday's price action highlights a potential short-term top and the possibility of a corrective pullback. In patterns terms, Wednesday's Japanese candle pattern is a bearish engulfing reversal. If correct, this signals scope for a correction and opens 127.04, Feb 15 low. A break of this level would allow for a deeper pullback. On the upside, the bull trigger for a resumption of gains is 128.46.

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