EUR/JPY is showing signs of bearish momentum after a recent retracement into key resistance levels. This analysis will break down the key levels, market structure, and potential trade setups based on the 1-hour chart.
Bearish Market Structure & Resistance Rejection
The chart indicates a clear downtrend, with lower highs and lower lows forming. The recent rally into resistance aligns with Fibonacci retracement levels, suggesting a potential continuation of the bearish trend.
Key Areas of Interest
Resistance Zone at 160.60 - 160.75: This area, marked as an "Area of Interest," aligns with the 0.5 and 0.618 Fibonacci retracement levels, making it a potential turning point for bearish continuation.
Support at 158.44: This level aligns with the Asian session low and could serve as the next bearish target if price resumes its downward movement.
Fibonacci Retracement & Potential Sell Zones
Price is currently retracing within the Fibonacci levels, with the 0.5 and 0.618 zones acting as potential resistance. If price fails to break above 160.75, a strong rejection could signal a sell opportunity targeting lower support levels.
Liquidity
Liquidity is likely sitting below the recent lows near 158.44. A stop-hunt scenario could see price briefly pushing above resistance before reversing downward.
Bearish Scenario: If price rejects the 160.60 - 160.75 zone with bearish confirmation (such as a strong rejection wick or bearish engulfing candle), traders could look for short entries targeting 159.40 and then 158.44.
Bullish Scenario: If price breaks and holds above 160.75, it could invalidate the bearish setup, opening the door for a potential push toward 161.20.
TRADE
Entry: 160.649
Stop Loss: 161.095
Take Profit: 159.242
Bearish Market Structure & Resistance Rejection
The chart indicates a clear downtrend, with lower highs and lower lows forming. The recent rally into resistance aligns with Fibonacci retracement levels, suggesting a potential continuation of the bearish trend.
Key Areas of Interest
Resistance Zone at 160.60 - 160.75: This area, marked as an "Area of Interest," aligns with the 0.5 and 0.618 Fibonacci retracement levels, making it a potential turning point for bearish continuation.
Support at 158.44: This level aligns with the Asian session low and could serve as the next bearish target if price resumes its downward movement.
Fibonacci Retracement & Potential Sell Zones
Price is currently retracing within the Fibonacci levels, with the 0.5 and 0.618 zones acting as potential resistance. If price fails to break above 160.75, a strong rejection could signal a sell opportunity targeting lower support levels.
Liquidity
Liquidity is likely sitting below the recent lows near 158.44. A stop-hunt scenario could see price briefly pushing above resistance before reversing downward.
Bearish Scenario: If price rejects the 160.60 - 160.75 zone with bearish confirmation (such as a strong rejection wick or bearish engulfing candle), traders could look for short entries targeting 159.40 and then 158.44.
Bullish Scenario: If price breaks and holds above 160.75, it could invalidate the bearish setup, opening the door for a potential push toward 161.20.
TRADE
Entry: 160.649
Stop Loss: 161.095
Take Profit: 159.242
Trade active
Note
Partials closed at 160.075. Stop moved to BETrade closed: stop reached
Stopped at BE after taking partials. 
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.