EUR/JPY ends four-day negative streak, rising more than a hundred pips
- EUR/JPY climbs back above 120.00, remains under 20-day SMA.
- Rally supported by a recovery in Wall Street and EUR/USD gains.
The EUR/JPY pair rose from a fresh three-week low at 119.30 back above 120.00. It peaked during the American session at 120.42, the strongest since Thursday. Over the last hours, it has been hovering around 120.30/40, holding onto strong daily gains and rising after falling during the previous four trading days.
The move higher took place amid higher equity prices in Wall Street and supported by a rally in EUR/USD while USD/JPY held steady, flat around 106.85.
From a technical perspective, Monday’s gains alleviate the bearish pressure and could point to further gains. On the upside, the immediate resistance is seen at 120.50, followed by the critical 20-day moving average at 120.85. A close above 121.00 could sign the bullish correction is over.
The main trend in EUR/JPY in the short-term still point lower but the momentum eased and some consolidation ahead seems likely, particularly if the pair holds above 119.30. On the contrary, a break lower would clear the way to more losses.
Technical levels
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
