EURJPY has been declining over the past three days, stopping at the 148.58 zone that has been preventing upside and downside movements since April. The 23.6% Fibonacci retracement of the 138.81-151.60 upleg is adding extra credibility to the region.
Spring’s upward structure seems to be cracking given the lower high of 151.00 that preceded the latest bearish correction. That said, the rising simple moving averages (SMAs) have yet to reflect a weakening trend.
Meanwhile, the momentum indicators remain negatively charged, with the RSI set to enter the bearish region below its 50 neutral mark. That might be a warning sign that selling appetite could persist in the coming sessions. Yet, traders might wisely wait for a clear close below 148.58, and perhaps beneath the 50-day SMA at 147.82, before targeting the 38.2% Fibonacci level of 146.70. Another step lower would downgrade the short- and medium-term picture, likely activating a quick downfall towards the 50% Fibonacci mark of 145.20.
Should the bulls lift the price back above the 20-day SMA, they may initially get congested within the 150.73-151.60 region, where a couple of trendlines are located. Surpassing that wall, the positive trend could continue towards the long-term resistance line from August 2020 at 153.60.
In a nutshell, EURJPY seems to be losing its shine as the upward pattern in the price has started to lean on the downside. A step below 148.58, and more notably a close beneath 147.82, could activate fresh selling orders.
