EURJPY has been trading within a consolidation area over the last month, with upper boundary the 129.28 resistance barrier, and lower boundary the 127.60 support level, having mid-level the 23.6% Fibonacci retracement level of the downleg from 133.10 to 126.60, around 128.15.
From the technical structure, in the 4-hour chart, the RSI indicator is moving slightly lower below the threshold of 50, while the MACD oscillator is flattening above the zero line but below the trigger line.
However, if prices rebound again on the 23.6% Fibonacci, they could jump towards the 128.90 resistance level, identified by the recent highs and then could touch the 38.2% Fibonacci mark of 129.10. More upside movement could drive the market until the upper boundary of 129.28. A penetration above this level could switch the neutral bias to a more positive one, hitting the 50.0% Fibonacci of 129.86.
Alternatively, if the market manages to turn to the downside and slip below the 23.6% Fibonacci, attention could turn to the 127.60 support. A clear run below the consolidation area may challenge the 127.25 barrier.
Overall, looking at the short-term picture, the market is predicted to remain neutral.
