The formation of the EURJPY currency pair suggests a large uptrend that moves within a large green channel. On the current chart, we see the price move since September of this year.
In the second half of September, the price reached the lower green area, after which the bulls tried to take over the market, however, they did not have enough strength. Thus, we saw a repeated bearish move towards the lower green line. Only after a repeated pullback from the lower green wall, the bulls sent the market to the upper green line within the smaller yellow channel.
It is assumed that a small correction is currently taking place in the market, which may soon be completed, so the bullish trend is expected to continue in the near future. If the bulls can break through the resistance level of 133.98, which is on the upper green wall, then they will open the way to a higher resistance level of 136.53, located on the upper yellow wall.
Let’s consider an alternative scenario. According to this view, it is assumed that the bulls have no chance, and it is unlikely that they will be able to defeat the bears. Thus, a reduction in the cost is expected in the short term. The first target is at the support level of 131.54, which is on the lower yellow wall. If this level is broken, market participants can expect a fall to a lower support level of 129.41, which is on the lower green line.