EURJPY is undergoing heavy buying right now. For those that have not been buying into this trade, I do not recommend it as it is too late to do so. The reward to risk ratio has been lowered significantly.
Two resistance levels have been marked. The higher resistance can be considered tested once. It is actually more visible on the lower time frame. The lower resistance level has been drawn in account of the heavy selling action. In terms of relative cheap and expensiveness of the pair, the lower resistance level represents a relatively expensive price level. This makes it attractive to be selling this pair.
EURJPY is expected to make one more push up before selling begins. The trading plan is quite simple. Aggressive traders can enter at the first resistance zone. However, a safer approach would be to enter a smaller volume sell trade and then scale-in if the price rises. In fact, scaling in actually works in both direction. It is also possible to add to the original sell position if price does reverse from the lower resistance level. By scaling-in on either side, you can average down your total cost or maximize your profits by posting a larger volume.
