EURJPY is easing for the fifth consecutive red day and is being capped by the 20-day simple moving average (SMA). The pair is creating a bearish correction in the short-term timeframe, but it still remains above the long-term uptrend line.
Technically, the RSI indicator is moving slightly lower around the neutral threshold of 50, while the stochastic is entering the oversold zone. Both currently confirm the recent negative movement.
Should prices decline further, immediate support could be found around the 23.6% Fibonacci retracement level of the up leg from 124.40 to 145.65 at 140.60. Then a leg below that level, the pair could meet the 50-day simple moving average (SMA) at 139.90 before the focus shifts to the 138.40 barrier
However, if the market manages to pick up speed, the 20-day SMA at 141.70 could offer nearby resistance ahead of the 144.10 barrier. A significant close above the latter would break the seven-and-a-half-year high of 145.65, raising chances for further increases.
In the long-term, the outlook is likely to remain positive since prices are holding above the uptrend line and the 200-day SMA.
