EUR/JPY closes below 157.00, eyes on potential SMA bearish cross

The EUR/JPY declined on Monday near the 156.90 area after initially rising near the 157.70 area, above the 20-day Simple Moving Average (SMA). 

Observing the daily chart, the cross displays a neutral-to-bearish technical outlook for the short term as the bears start to gain momentum, but they still have work to do. Since September, the pair has been trading sideways between the 154.70 - 157.00 range, with the trajectory slightly tilted to the downside.

The daily Relative Strength Index (RSI) displays a flat slope below the 50 middle point. At the same time, the Moving Average Convergence (MACD) prints stagnant red bars, suggesting that bearish momentum is modestly growing with sellers dominating. On the four-hour chart, indicators also show signs of a neutral outlook and a slight command by the bears. In the broader context, the pair is below the 20-day Simple Moving Average (SMA) but above the 100- and 200-day SMAs, suggesting that the bears struggle to challenge the overall bullish trend. That being said, the 100- and 20-day SMAs seem to be converging towards the 156.00 area to perform a bearish cross, which could fuel a downward leg for the EUR/JPY.

 Support levels: 156.50, 155.90 (100-day SMA), 155.00.

 Resistance levels: 157.36 (20-day SMA), 158.00, 159.00.

 EUR/JPY Daily Chart