EUR/JPY shows appetite for retesting 40-year high
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EURJPY holds well above uptrend line.
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RSI stands near 70 level.
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Next target at multi-year peak.
EURJPY is rallying sharply higher after the strong bounce off the 164.00 support level and the medium-term ascending trend line. The pair is heading towards the previous 40-year high of 171.56 with the technical oscillators confirming the buying interest.
The RSI is approaching the 70 level with strong momentum, holding above its uptrend line, while the MACD is strengthening its climb above its trigger and zero lines.
Further increases could send the market towards the multi-year high of 171.56 ahead of the next psychological number of 172.00.
On the flip side, a downside retracement could open the way for a retest of the latest bottom at 167.30 ahead of the uptrend line and the 50-day SMA at 165.40. A break below this line could drive traders towards the 164.00 handle, switching the outlook to neutral.
Summarizing, as long as EURJPY remains well above the rising trend line and more importantly above the 200-day SMA, the outlook is bullish.
Author
Melina joined XM in December 2017 as an Investment Analyst in the Research department. She can clearly communicate market action, particularly technical and chart pattern setups.
