EUR/JPY - Bear-trap sprung and indicates a ending diagonal has completed
In my June 3 post (you can see it by clicking here), my final words was "I don't feel very comfortable about the downside and do think the downside is very limited, so please don't become overly bearish this cross and this time as a low can be found anytime now".
Well that warning seem to be justified by the failure to build at the break below 121.46. In fact, I think that this was a nice bear-trap and that an ending diagonal has terminated at the 120.80 low and a quick return to the origin of the ending diagonal at 128.22 should be expected.
More importantly a break above the ending diagonal resistance-line near 123.80 will confirm that the long term correction from 149.56 finally has come to an end and a new impulsive rally finally can begin, with the first larger target being the 141.06 resistance.
Only a failure to break above the resistance-line near 123.80 and break back below 120.80 revives the 117.95 - 118.20 target, but that seems pretty unlikely to happen.
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