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Technical Analysis – EUR/JPY continues the negative bias


EUR/JPY struggles to jump above the medium-term falling trend line.

EUR/JPY has declined over the past couple of days as the price struggled to jump above the 38.2% Fibonacci retracement level of the down-leg from 137.50 to 124.60. Also, the pair is still developing below the medium-term ascending trend line, which has been holding since February 2.

Momentum indicators in the 4-hour chart though are currently supporting that the negative momentum is likely to strengthen in the short-term. Specifically, the RSI is picking up speed to the downside and the MACD continues to hold below its trigger line. As a side note, the Bollinger bands are following the price action and seem to be ready to create a sideways channel.

On the downside, a decline could meet the 40-simple moving average (SMA) in the 4-hour chart, which overlaps with the 128.40 support. A slip below this level, the price could retest the 23.6% Fibonacci of 127.66.

Should the price decisively close above the roof of the descending line and the 38.2% Fibonacci, the next resistance to have in mind is the 130.30 barrier. Further advances above this level, could then target the area around the 50.0% Fibonacci of 131.10 and the 131.37 resistance.

To sum up, EUR/JPY continues the negative bias in the short- and medium-term as the bounce off the diagonal line has driven the pair significantly lower.

EUR/JPY 04/07/18 | EconAlerts

 

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Disclaimer:
This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.


source: XM

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