EUR/JPY Technical Analysis: eyes sub-124.00 levels on growth concerns and triangle breakdown

The EUR/JPY pair could soon drop below 124.00 as the markets are likely to price in a delay in the ECB rate hike, courtesy of weakening of domestic demand conditions across the Eurozone.
On Monday, the International Monetary Fund (IMF) revised lower its global growth forecasts for the second time in three months, citing softening demand across Europe and recent palpitations in financial markets.
Notably, the IMF now sees the German economy expanding 1.3 percent this year, down 0.6 percentage points from October.
The ECB, therefore, has little room to sound dovish. Put simply, developments on the fundamental front favor downside in the EUR. Validating that argument is the triangle breakdown seen in the EUR/JPY chart below.

Omkar Godbole FXStreet Contributor

Hourly chart

Trend: bearish

EUR/JPY

Overview:
    Today Last Price: 124.28
    Today Daily change: -0.42 pips
    Today Daily change %: -0.34%
    Today Daily Open: 124.7
Trends:
    Daily SMA20: 124.8
    Daily SMA50: 126.92
    Daily SMA100: 128.4
    Daily SMA200: 128.97
Levels:
    Previous Daily High: 124.83
    Previous Daily Low: 124.51
    Previous Weekly High: 124.98
    Previous Weekly Low: 123.39
    Previous Monthly High: 129.3
    Previous Monthly Low: 125.36
    Daily Fibonacci 38.2%: 124.71
    Daily Fibonacci 61.8%: 124.63
    Daily Pivot Point S1: 124.53
    Daily Pivot Point S2: 124.36
    Daily Pivot Point S3: 124.2
    Daily Pivot Point R1: 124.85
    Daily Pivot Point R2: 125.01
    Daily Pivot Point R3: 125.18

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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