EUR/JPY Long-Term Analysis: Bearish
EUR/JPY pair has broken below the moving averages as price reached the low of level 129.19. The previous uptrend is presumed to have been terminated. The downtrend may reach the previous low at level 128.30. At the previous low, the RSI for period 14 may reach the oversold region. Meanwhile, on October 28 downtrend; a retraced candle body tested the 50% Fibonacci retracement level. The retracement indicates that EUR/JPY price will fall to level 2.0 Fibonacci extension or level 129.82. From the price action, the currency pair has tested the Fibonacci level. The pair is declining to reach the previous low at level 128.30.
EUR/JPY Indicator Analysis
The currency pair has fallen to level 34 of the Relative Strength Index for period 14. The pair is gradually approaching the oversold region at level 30. The 21-day SMA and the 50-day SMA are sloping downward. EUR/JPY is below the 20% range of the daily stochastic. The currency pair has fallen into the oversold region. Further selling pressure is unlikely.
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?
On the 4-hour chart, the pair is in a downward move. EUR/JPY is in a smooth downtrend. The pair is below the moving averages, the 21-day moving average acting as a resistance. Today, there are bullish candlesticks above level 129.00. If buyers push the pair above the moving averages and the bullish momentum is sustained, it will signal the resumption of an uptrend.
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