EUR/JPY analysis: dollar weakness fuels yen gains

EUR/JPY Current price: 120.82

The EUR/JPY pair closed marginally lower after a failed attempt to advance beyond 121.40 at the beginning of the day, with the Japanese yen gaining traction against its major rivals during the American afternoon, following a decline in US Treasury yields and with equities generally weak worldwide. The pair traded as high as 121.42, meeting selling interest at a major Fibonacci resistance the 23.6% retracement of the November/December rally, and also the 100 DMA. Now hovering around its daily low, the pair is pressuring a modestly bullish 100 DMA in the daily  chart, while the 20 SMA maintains a sharp bearish slope above the current level, and technical indicators resumed their declines after correcting up to their mid-lines at the beginning of the day, all of which maintains the risk towards the downside. The pair has an immediate support at 120.60, and a break below it would likely open doors for a continued decline towards the 119.70 region, the 38.2% retracement of the mentioned rally.

Support levels: 120.60 120.15 119.70

Resistance levels: 121.40 121.85 122.30

View Live Chart for the EUR/JPY

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