Technical Analysis – EURJPY rises above uptrend line in short term

Melina Deltas, XM Investment Research Desk

EURJPY has been in an ascending move since June 19 in the short-term, surpassing the 23.6% Fibonacci retracement level of the up leg from 114.40 to 124.45 at 122.08. The short-term bias looks positive as the RSI keeps gaining ground above the 50 level, while the stochastic seems to be making its way up after the bounce off the 20 level.

The 122.50 resistance could be a trigger point for steeper bullish action. Even higher, resistance could run towards the 124.10 barrier, though buyers could be waiting to enter the one-year high of 124.45.

However, if the pair reverses back to the downside, investors could take the price to the 121.30 support level ahead of the 40-period simple moving average (SMA) at 121.50. Marginally below this line, support could next come somewhere between 121.30 and the 100-period SMA at 121.10. If the price continues to drop, the 38.2% Fibo of 120.60 and the rising trend line may halt the bearish movements.

In the short-term picture, chances for another bullish move are still rising as the SMAs keep edging higher and the price stands above the trend line.