EUR/JPY analysis: bearish momentum to accelerate below 112.05

Valeria Bednarik FXStreet

EUR/JPY Current price: 112.96

The EUR/JPY pair fell for a second consecutive week, printing 112.60 on Friday, to settle at 112.96 on Friday, with the Japanese yen bolstered by BOJ's Governor Haruhiko Kuroda words, who stated that he couldn’t perceive any real chance of excessive risk-taking or overheating in Japan’s financial activity, adding that there is a chance that the Central Bank will delay the date the economy will hit its inflation goal of 2%. EUR self-weakness added to the bearish case. The pair has been trading in a well-limited range between 112.05 and 116.30 since late July, and the daily chart shows that it may challenge such low, given that technical indicators head sharply lower within bearish territory, whilst the price was steadily rejected on attempts to surpass its 100 DMA. In the shorter term, and according to the 4 hours chart, the downward potential seems limited, given that technical indicators have bounced from oversold readings, whilst the moving averages, despite being above the current level, lack directional strength. Nevertheless, a break below the mentioned low should lead to a quick slide towards 112.05, whilst a break below this last could result in an acceleration of the bearish momentum.

Support levels: 112.60 112.05 111.50

Resistance levels: 113.20 113.65 114.00

View Live Chart for the EUR/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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