EUR/JPY Price Analysis: Dropped but holds to 140.50s, as bears eye the 200-DMA
|- The EUR/JPY cut last Friday’s gains, dropping towards the 200-day EMA, as sellers target 140.00 and below.
- EUR/JPY Price Analysis: The pullback towards the 200-DMA might pave the way for a deeper correction before resuming the uptrend.
EUR/JPY continued to trade lower for two consecutive days, retracing most of last Friday’s gains, and reclaimed the 50 and 20-day Exponential Moving Averages (EMAs), on its way south. The Euro’s (EUR) collapse was capped by the trend-setter 200-day EMA at 140.30, though it would likely remain under pressure. At the time of writing, the EUR/JPY is trading at 140.52, with losses of 1.20%, as Tuesday’s session ends.
EUR/JPY Price Analysis: Technical outlook
The EUR/JPY shifted to neutral from neutral-upwards, according to the daily chart, following Tuesday’s fall beneath essential demand zones. In addition, the EUR/JPY pair could turn neutral downwards as the spot price hovers nearby the 200-day EMA, which, once cleared, could pave the way for further losses.
The Relative Strength Index (RSI) and the Rate of Change (RoC) supported the above-mentioned scenario, meaning that in the short term, the EUR/JPY might pull back before resuming its uptrend.
Therefore, the EUR/JPY first support would be the 200-day EMA at 140.30. A breach of the latter will send the pair sliding towards the 140.00 figure, which, once cleared, the EUR/JPY might fall toward the January 20 daily low of 139.03.
As an alternate scenario and the current trend, the EUR/JPY first resistance would be the 20-day EMA at 141.03. A break of that supply zone and the EUR/JPY might rally toward the psychological 142.00 area followed by the February 7 high fo 142.33.
EUR/JPY Key Technical Levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.