A similar scenario for the euro/yen pair, where it managed to test the resistance of the descending channel as shown on image, while stochastic is negative over the four-hour time frame. We think that these factors will push the pair to reverse to the downside to retest the breached pivotal level at 104.95 as a main target, where we will monitor trading around that level, as breaching it is a strong signal that the pair may resume the overall downside trend, taking into consideration that breaching 106.90 will open the door for more intraday bullishness.
The trading range for today may be among the 113.95 support and 108.85 resistance.
The short term trend is to the downside targeting 94.80 so long as 123.30 remain intact.
|Recommendation||Based on the charts and explanations above we recommend selling the pair around 106.90 targeting 104.95 and stop loss with four-hour closing above 107.80 may be appropriate.|