EURJPY has been retreating significantly over the last few hours, struggling within an upward sloping channel since January 15 finding strong resistance obstacle around the 50.0% Fibonacci retracement level of the downleg from 133.10 to 118.57, around 125.85. According to the technical indicators, in the 4-hour chart, the RSI and the MACD are losing momentum below the neutral threshold of 50 and near the zero line respectively.
If the market continues to move even lower, the pair could touch the lower Bollinger band around 124.70. In case of an extension below this line and the ascending trend line, the 38.2% Fibonacci of 124.40 could be in focus. Another step lower may reach the 123.40 support barrier.
On the other side, if the market pushes the pair higher, the price could re-challenge the 50.0% Fibonacci and the 125.95 resistance area. More advances would likely open the door for the 127.10 resistance, taken from the highs on December 27.
In the longer timeframe, the price remains in a strong bearish structure following the pullback on 133.10 and only an advance above the 61.8% Fibonacci near 127.60 could confirm bullish correction mode.
