Technical Analysis – EURJPY bears take the lead; 23.6% Fibonacci support level still holding
February 14, 2018 10:26 am
EURJPY has been trading sharply lower since the previous week, following the pullback from the more than a 2-year high of 137.50. Prices broke below the 133.00 handle over the last couple of sessions in the 4-hour chart and are trading below their moving averages. The bearish picture in the short-term is further supported by the technical indicators.
Looking at the 4-hour chart, momentum indicators are also pointing to a continuation of the bearish bias despite that the pair is moving slightly higher at the time of writing. The stochastic oscillator posted a bearish crossover within its moving averages, while the MACD oscillator is still holding in the negative territory. As a side note, in the daily timeframe, the 20-simple moving average is ready to create a cross to the downside with the 40-SMA, suggesting a downward pressure.
If price continues the sell-off, the next level to have in mind is the 23.6% Fibonacci retracement level of the up-leg from March 2017 to January 2018, which is slightly above the 132.00 significant psychological level and served as support only last week. Below that, the 131.40 level – another previous support area – comes into view.
Conversely, in case of an upward correction of the last aggressive bearish move, the price could re-challenge the 133.80 resistance level, which is near the 40-SMA. A break above the aforementioned obstacle, could open the door for the next immediate resistance of 134.20.
EURJPY has been trading sharply lower since the previous week, following the pullback from the more than a 2-year high of 137.50. Prices broke below the 133.00 handle over the last couple of sessions in the 4-hour chart and are trading below their moving averages. The bearish picture in the short-term is further supported by the technical indicators.
Looking at the 4-hour chart, momentum indicators are also pointing to a continuation of the bearish bias despite that the pair is moving slightly higher at the time of writing. The stochastic oscillator posted a bearish crossover within its moving averages, while the MACD oscillator is still holding in the negative territory. As a side note, in the daily timeframe, the 20-simple moving average is ready to create a cross to the downside with the 40-SMA, suggesting a downward pressure.
If price continues the sell-off, the next level to have in mind is the 23.6% Fibonacci retracement level of the up-leg from March 2017 to January 2018, which is slightly above the 132.00 significant psychological level and served as support only last week. Below that, the 131.40 level – another previous support area – comes into view.
Conversely, in case of an upward correction of the last aggressive bearish move, the price could re-challenge the 133.80 resistance level, which is near the 40-SMA. A break above the aforementioned obstacle, could open the door for the next immediate resistance of 134.20.
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