EURJPY has paused around the flat 50-period simple moving average (SMA) at 121.70, after a bounce off the 100-period SMA failed to reach the five-and-a-half high of 122.60. The pairs’ improving picture appears still valid, with the intact bullish crossovers restricting the price from declining further.
The short-term momentum oscillators reflect the recent stall in price as does the flat 50-period SMA. The MACD has declined below its red trigger line and approaches the zero mark, while the RSI has fallen below its neutral 50 level.
To the upside, initially buyers could confront some downside pressure at the nearby swing high of 122.09 ahead of a resistance area of 122.50 to 122.60. It consists of the fresh peak of December 27 and the five-month peak, joined with the 61.8% Fibonacci retracement of the down leg from 126.80 to 115.85. Overcoming this, the price may rally to test the 123.35 resistance from back in July, while if overrun as well, the price could stretch till the swing high of 123.74 from May 21.
Otherwise, if sellers push below the 50-period SMA at 121.70, a tougher support region from 121.46 to 121.32, which encapsulating the 100-period SMA could halt further declines towards the 121.05 low. Conquering this, the 200-period SMA at 120.83 could obstruct the bears from reaching the 120.34 swing low and trough, residing at the 38.2% Fibo of 120.00.
In brief, the short-term bias is neutral-to-bullish above 121.05, with a break above 122.60 strengthening this outlook.
