Elliott wave analysis of EUR/JPY for October 16, 2020

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EUR/JPY failed to break back above minor resistance at 123.99 to confirm the wave ii had completed. Instead, the correction in wave ii took a second deeper dip to a low of 123.02. Until we see a break above minor resistance at 123.49 and more importantly a break above resistance at 123.99 we cannot exclude another dip to test the 78.6% corrective target at 122.95. It is not necessary that we see another dip but at this point in time, it cannot be excluded. Only a break above minor resistance at 123.49 will indicate that wave ii has been completed and wave iii may develop a rally to 128.02

R3: 123.99

R2: 123.49

R1: 123.21

Pivot: 123.10

S1: 123.02

S2: 122.95

S3: 122.71

Trading recommendation:

We are long EUR from 123.48 with our stop placed at 123.00. If our stop is triggered, we will re-buy EUR upon a break above 123.49

The material has been provided by InstaForex Company - www.instaforex.com