Technical outlook and chart setups:
The EUR/JPY pair dropped lower towards 124.60 levels before pulling back sharply yesterday. The pair is trading at 125.90 levels and should be looking to form lower lows till prices remain below 127.00 levels. Please note that the interim support trend line has provided a bullish bounce at 124.60 levels, but bears are expected to regain control soon. Also note that the pair has unfolded into 3 waves from 122.00 levels, which is corrective. Hence the probability for a drop lower remains high until prices hold 127.00 levels. It is recommended to remain short against 127.00 levels for now. The immediate interim resistance is seen at 127.00 levels, while support is at 124.60 levels respectively.
Trading recommendations:
Remain short for now, stop at 127.50, target is open.
Good luck!
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