EUR/JPY analysis: decline remains corrective, watch 127.55
|EUR/JPY Current price: 129.04
The EUR/JPY pair changed course after four consecutive weekly gains and closed this last one in the red at 129.04, as the Japanese currency benefited more than the EUR from speculation that the Fed will have less room to maneuver in the months to come. US Treasury yields tumbled on Friday on soft US data, but closed off their daily lows, still down on the week and backing yen's gains. The Bank of Japan will have its monetary policy meeting this week, but a change in its easing stance is quite unlikely. The decline remains corrective in the daily chart, as the price settled above the 23.6% retracement of its latest bullish run, with some short-lived slides below it being quickly reverted last week. In the same chart, technical indicators have corrected extreme overbought conditions, but continue heading lower within positive territory, while the 100 and 200 DMAs advance far below the current level. In the 4 hours chart, the 100 SMA maintains its bullish slope below the current level, providing a dynamic support around 128.15, while the Momentum indicator head higher around its 100 level and the RSI indicator consolidates around 44, indicating a limited downward potential. The 38.2% retracement of the latest daily rally stands at 127.55, with a break below it required to confirm a sustainable decline.
Support levels: 128.60 128.15 127.70
Resistance levels: 129.30 129.75 130.20
View Live Chart for the EUR/JPY
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