EUR/JPY is consolidating below a strong resistance level of 128.850. In fact, the Japanese cross tried to violate this level several times with no success. However, the pair is likely to test this level again, but this time the only difference is that the bullish trend looks stronger.

The EUR/JPY is trading a pattern called ascending triangle which typically breaks on the upper side. Moreover, the following technicals are lining up for a bullish breakout…

– Three white soldiers in the daily time frame are supporting the bullish bias of investors.
– Yesterday, the daily candle closed outside the previous range – the very first indication of a bullish breakout.
– Stochastic is trading in the buying zone (above 50). It’s signifying a strong bullish trend.

Support Resistance
128.32 129.11
127.83 129.4
127.05 130.18
Key Trading Level: 128.62

EUR/JPY – Trading Plan
We should wait for a slight correction in the pair before entering a buy position. Preferred entry will be above 128.850 as it’s better to capture a breakout than risking a sell below it. On the upper side, EUR/JPY can target 129.250 and 129.490.

Good luck!