- The weekly recovery in EUR/JPY lost traction in the mid-120.00s.
- The resumption of the buying bias should target the 121.50 region.
The cross met strong resistance in the 120.50 region on Monday, coincident with the 21-day SMA.
Th subsequent inability of EUR/JPY to surpass this hurdle has motivated sellers to return to the markets in tandem with the quick pick up in the demand for the safe haven Japanese yen and the generalized risk-off mood in the global markets.
A deeper retracement should meet moderate contention in the 119.45/24 band, where converge the 100-day and 55-day SMAs as well as monthly lows recorded on November 14th.
In order to alleviate the immediate downside pressure, the cross needs to overcome weekly highs in the 120.50 region and therefore refocus on October peaks in the 121.50 region ahead of the key 200-day SMA AT 121.78.
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