EURJPY is trading in the vicinity of the 131.00 handle and the 100-day simple moving average (SMA) but buyers’ traction off the 129.56 level seems to have run out of steam. The advancing 100- and 200-day SMAs are endorsing the broader positive structure, while the slight dwindling in the 50-day SMA’s incline is signalling that the retraction from the near 40-month high of 134.12 may be securing an edge.
The Ichimoku lines are hinting that negative momentum may soon pick up again, while the short-term oscillators are suggesting bullish forces could attempt to take the lead. The MACD, in the negative region, is improving and is looking set to push above its red trigger line, while the RSI is currently static in the bearish zone after rebounding off the 30 level. Moreover, the stochastic oscillator’s %K line is promoting additional price gains in the pair.
To the upside, buyers may face immediate resistance from the 131.00 hurdle until the 131.26 inside swing low. Prodding over this band of resistance that contains the 100-day SMA, buyers would then need to navigate above the Ichimoku cloud’s lower surface at 131.85 to tackle the resistance section of 132.32-132.87. Recapturing the area above this tough barricade is critical to reinforce positive belief and a test of the 133.57-134.16 limiting zone.
If the 131.00 border together with the 100-day SMA cap an extension of the recent bounce, sellers could encounter preliminary support around the 129.56 low. Should the 1½-month decline from the multi-year peak of 134.12 resume below the aforementioned low, the 128.82 obstacle may come into play before sellers target the 200-day SMA, residing at the March 24 trough of 128.28.
Summarizing, EURJPY’s broader outlook still holds a positive demeanour above the 129.61 low and the 200-day SMA. However, its near-term picture of lower highs and lows is strengthening a negative skewness below the 132.67 high and the cloud.
