- EUR/JPY bears stepping back in at 4-hour resistance.
- Bears seek a break of recent support to expose daily support again.
As per the prior analysis, EUR/JPY Price Analysis: Bears seeking a break of daily support, the price remains under pressure below resistance following a sharp upside correction.
The bulls, however, are testing the bear’s commitments to the downside thesis with a higher corrective high printed in late Asia on Tuesday.
As such, there are few prospects of a downside extension until a break towards 129.18 and once a new 4-hour bearish structure has been formed.
The following illustrates the current market structure, price action and theory.
(Bullish scenario)
The daily close left a bullish wick when considering the price action on the lower time frames.
The wick is a target for the bulls to fill.
(Bearish scenario)
Meanwhile, the bearish prospects are still valid but require confirmation from lower time frames and their bearish environments. So far, none are apparent.
4-hour chart
The price has printed a higher high but there are prospects of the old support acting as resistance on the correction of the latest 4-hour bearish impulse.
A confluence of the Fibonaccis raises the probability of a downside extension to test the recent lows which guard a run to the daily support area.
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