The EURJPY on the H4 time frame had an extremely long and powerful bullish trend that was finally broken when a lower top was recorded on 10 January at 131.360. After the lower top at 131.360, the price broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator joined by changing course to the bearish side. A possible critical support level formed when a lower bottom was recorded later during the same session at 130.159.
The bulls then tried their best to take control again but it seems that the bears have enough backing since an apparent resistance level was reached at 130.873. Can the bears pull this off and hang in there? Only time will tell.
EURJPY H4 Chart
If the bears manage to break through the critical support level at 130.159, then three possible price targets can be projected from there. Attaching the Fibonacci tool to the lower bottom at 130.159, and dragging it to the possible resistance level at 130.873, the following targets can be calculated. The first target can be estimated at 129.718(161.8%). The second price target might be considered at 129.004 (261.8%) and the third and final target may be expected at 127.848 (423.6%).
If the resistance level at 130.873 is broken, the above scenario is not valid and must be re-assessed. As long as bears keep adding momentum to the EURJPY, the outlook for this market will remain on the bearish side.