EUR/JPY Long-Term Analysis: Bearish
EUR/JPY pair has rebounded above level 127.51 and attempts to reach level 131.78. . The bulls have broken above the 21-day line moving average to resume an uptrend. The pair is also approaching the 50-day line moving average to retest it. When price breaks above the moving averages, the upside momentum will resume. Meanwhile, on December 9 uptrend, a retraced candle body tested the 38.2% Fibonacci retracement level. The retracement indicates that EUR/JPY will rise to level 2.618 Fibonacci extension or 131.78.
EUR/JPY Indicator Analysis
The currency pair has risen to level 55 of the Relative Strength Index for period 14. The pair is in the uptrend zone and capable of a further upward move. The Yen is above the 80% range of the daily stochastic. The market has reached the overbought region of the market. The pair will soon face rejection as sellers emerge in the overbought region. The 21-day and 50-day moving averages are sloping horizontally indicating the previous trend.
Technical indicators:
Major Resistance Levels – 133.00, 134.000, 135.000
Major Support Levels – 128.000, 127.000, 126.000
What Is the Next Direction for EUR/JPY?
EUR/JPY has resumed the uptrend and attempts to reach level 131.78. The daily stochastic has indicated that the pair is trading in the overbought region of the market. However, the RSI has indicated that the pair is still in the uptrend zone. The bottom line is that if the pair reaches the next resistance, the market will encounter a decline.
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