EUR/JPY Price Analysis: Eases after four-week high on low volume trading, risk-on impulse
- EUR/JPY slips from a four-week high of 151.07, with US debt ceiling developments cushioning the fall amidst Japanese Yen strength.
- Bullish technical indicators hint at a potential upward trajectory for EUR/JPY, placing the YTD high of 151.61 within reach despite the current dip.
- Surpassing the weekly high of 151.07 could challenge the YTD high, with upside potential at 152.00; initial support rests at 150.00.
EUR/JPY retreats after hitting a new four-week high of 151.07, down 0.26% during the day amidst thin liquidity conditions, sponsored by holidays in Europe and the United States (US). Positive news about the US debt ceiling improved appetite, capping the EUR/JPY’s fall amidst the Japanese Yen (JPY) strength during the day. At the time of writing, the EUR/JPY is trading at 150.34.
EUR/JPY Price Analysis: Technical outlook
The daily chart shows that the EUR/JPY is upward biased, though, in Monday’s session, the cross-currency pair dipped below the May 3 high-turned-support at 150.39 and later reclaimed the latter. Although aiming downward, the Relative Strength Index (RSI) stays in the bullish territory, while the 3-day Rate of Change (RoC) persists above the neutral line. That said, the EUR/JPY in the near-term warrants further upside, which could put the year-to-date (YTD) high of 151.61 in danger.
If EUR/JPY buyers reclaim the weekly high of 151.07, a test of the YTD high of 151.61 is on the cards. The upside risks lie at 152.00. Conversely, the EUR/JPY first support would be 150.00, but further losses are expected on a drop below the latter at around the 20-day Exponential Moving Average (EMA) at 149.09.
EUR/JPY Price Action – Daily chart
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
