EUR/JPY Price Analysis: Reached a fresh monthly low at 128.14, bears target 128.00

The euro continues its free-fall against the Japanese yen, as the EUR/JPY is sliding for the sixth straight day, is down 0.08%, trading at 128.29. On Monday, the cross-currency printed a fresh monthly low at 128.14 but bounced modestly closing at 128.39, for a 0.40% loss.

EUR/JPY daily chart

The EUR/JPY pair is trading at 128.24 near a rising trendline from the 2021 low around January, passing through the August lows acting as support. Nevertheless, as the EUR/JPY spot price is trading below its daily moving averages, it suggests downward pressure.

Adding to this, the 50-day moving average (DMA) is crossing below the 200-DMA, resulting in a death-cross pattern, that confirms the switch from an uptrend to a downtrend. 

For the bears to push the prices lower, they will need a daily close beneath that trendline, around 128.20. In case of a daily close beneath, it would open the door for further losses. The first support level would be the August 19 low at 127.92. A breach of that level could expose the 2021 low at 125.08.

On the other hand, failure to break 128.20 could consolidate the cross-currency within the 128.20-128.52 range. A break above the latter could open the door for further gains, with 128.95-129.00 as the first supply zone. Once the latter is broken, the next resistance would be the confluence of the 50 and the 200-day moving average, around 129.54-56.

The Relative Strength Index is at 32.51, slightly flat, however, as it remains beneath the 50-midline, maintains the bearish bias.