Technical Analysis – EURJPY uncovers upside forces as it recoils to 100-MA
- Anthony Charalambous
EURJPY has managed to unearth some bullish forces around the 100-day simple moving average (SMA) at 130.56, currently merging with the Ichimoku cloud’s lower boundary. The pair has succeeded in countering the strong fading of the pair from the near 40-month region of highs, which ticked down to the 130.00 handle. Nonetheless, the advancing SMAs are providing bullish defences for the broader uptrend.
The Ichimoku lines are reflecting that downside pressure is subsiding, while the short-term oscillators are demonstrating mixed signals in directional momentum. The MACD has plunged below zero and has distanced itself far beneath its red trigger line, while the RSI is improving after its bounce off of the 30 level. The stochastic oscillator is promoting bullish traction off strong footing, formed at the lower frontier of the Ichimoku cloud.
Returning above the cloud, initial upside constraints could emanate from the resistance zone of 132.17-132.77. That said, hiking above this obstacle could encourage buyers to challenge the resistance ceiling of 133.57-134.16, which also includes the multi-year high of 134.12 and the 134.16 barrier, identified in February 2018. Breaching the peak could then steer the bulls towards the 134.83 border, formed back in early February 2018.
Otherwise, for the downward trajectory to persist, sellers would need to pierce beneath the immediate support section of 130.56-131.00. Should this base give way, the previous candle’s low at 130.00 and the 129.56 level could try to impede the decline from gaining pace and testing the critical trough of 128.28, from March 24.Summarizing, EURJPY’s near-term positive tone should remain intact if the price persists above the 100-day SMA and the 129.56 barrier. Moreover, a return in the price to the vicinity of 133.00 could bolster optimism.
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