EUR/JPY Long-Term Analysis: Bearish
EUR/JPY pair is in a downtrend but rebounds to an overbought region. The current uptrend has been terminated. The Yen is above the 50-day line SMA but below the 21-day line SMA. The currency pair will be compelled to fluctuate between the moving averages for a few more days. On the downside, if price retraces and breaks below the 50-day line SMA, the downtrend will resume. The Yen will fall and revisit the previous low at level of 124.39. On the other hand, if price breaks above the 21-day line SMA, it will signal the resumption of the uptrend.
EUR/JPY Indicator Analysis
Because of the recent downtrend, the currency pair is at level 54 of the Relative Strength Index for period 14. The currency price is between the moving averages which indicates that the Yen will resume a sideways move between the moving average lines for a few days. The uptrend has been terminated as price breaks below the trend line. The pair is above the 40% range of the daily stochastic. It indicates that the market is in a bullish momentum.
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 Yen is in a downtrend but rebounds to an overbought region. The downtrend has subsided as the pair fell to the oversold region of the market but resumed upward. Meanwhile, on April 25 downtrend; a retraced candle body tested the 78.6% Fibonacci retracement level. The retracement indicates that EUR/JPY will fall to level 1.272 Fibonacci extension or $135.54. From the price action, the Yen has retested the level 1.272 Fibonacci extension and resumed upward.
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