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FxWirePro: EUR/JPY recovery capped at 125 levels, pair slips below 5-DMA, good to short rallies

EUR/JPY recovery from multi-year lows at 122.45 (last seen in Apr 2013) was capped at 125 on Friday's trade.

  • The pair has slipped 5-DMA at 123.90, and finds next strong support at 123.20 (wedge base). 
     
  • Doji formation evidenced on Friday's trade, pair unable to take recovery beyond the 125 handle.
     
  • Price action well below the cloud and major moving averages biased lower. Break below 123.20 could see test of 122.45 levels (Feb 24th lows).

Recommendation: Good to sell rallies around 123.60 levels, SL: 124.50, TP: 123/122.45.

Resistance Levels:

R1: 123.90 (5-DMA)

R2: 124 (psychological level)

R3: 124.61 (Feb 24th highs)

Support Levels:

S1: 123.20 (Wedge base)

S2: 123 (psychological level, Feb 23rd low)

S3: 122.45 (Feb 24th lows)

 

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