- Short-term supports could limit further declines amid oversold RSI.
- 200-HMA and 38.2% Fibo. restrict near-term upside.
Despite trading near the week’s lows surrounding 122.15, EUR/JPY might find it hard to extend the latest weakness as it is still left to clear key supports during early Friday.
Among them, a 10-day long ascending trend-line at 122.04 seems the first one to question the sellers, if ignored can drag the quote to support-line of the short-term descending channel at 121.97.
Should bears refrain from respecting oversold levels of 14-bar relative strength index (RSI), 61.8% Fibonacci retracement around 121.70 and the month’s low near 120.90 could entertain them.
Meanwhile, 38.2% Fibonacci retracement and 200-hour moving average (HMA) offers a resistance confluence near 122.25/30, a break of which can propel the quote to 122.50 and then to channel’s resistance of 122.65.
If at all prices defy downward sloping channel formation by clearing 122.65, current month high around 123.20 and 123.70 are likely to flash on the chart.
EUR/JPY hourly chart
Trend: Pullback expected
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