Technical Analysis – EURJPY could consolidate gains in short-term
March 28, 2018 2:26 pm
EURJPY rebounded significantly on Monday, jumping from a seven-month low of 128.93 on Friday to a two-week high of 131.80. Since then, the pair maintained this uptrend and the technical indicators in the 4-hour chart suggest that the market could consolidate gains in the near-term.
Looking at momentum indicators, the RSI is moving sideways above 50 since yesterday, while the MACD is trending in positive territory above 50 but is currently capped by its red signal line suggesting that prices could continue the range-bound trading, but the bullish cross between the 20- and the 50-period simple moving averages hints that Monday’s uptrend could remain in place.
However, if the pair extends to the upside, the 23.6% Fibonacci of 131.12 of the upleg from 128.93 to 131.80 could come first into view before the focus shifts to the two-week high of 131.80. A decisive close above the latter could send prices up to the 132 handle, while steeper increases could see a retest of the March high of 132.42.
On the way down, immediate support could come from the 38.2% Fibonacci of 130.70. In case the market fails to hold above this level, the area between the 20-period SMA and the 50% Fibonacci of 130.36 could attract a greater attention because a leg below from here could signal that negative correction are likely to follow, with scope to test the 130-psychological level – which coincides with the 61.8% Fibonacci.
EURJPY rebounded significantly on Monday, jumping from a seven-month low of 128.93 on Friday to a two-week high of 131.80. Since then, the pair maintained this uptrend and the technical indicators in the 4-hour chart suggest that the market could consolidate gains in the near-term.
Looking at momentum indicators, the RSI is moving sideways above 50 since yesterday, while the MACD is trending in positive territory above 50 but is currently capped by its red signal line suggesting that prices could continue the range-bound trading, but the bullish cross between the 20- and the 50-period simple moving averages hints that Monday’s uptrend could remain in place.
However, if the pair extends to the upside, the 23.6% Fibonacci of 131.12 of the upleg from 128.93 to 131.80 could come first into view before the focus shifts to the two-week high of 131.80. A decisive close above the latter could send prices up to the 132 handle, while steeper increases could see a retest of the March high of 132.42.
On the way down, immediate support could come from the 38.2% Fibonacci of 130.70. In case the market fails to hold above this level, the area between the 20-period SMA and the 50% Fibonacci of 130.36 could attract a greater attention because a leg below from here could signal that negative correction are likely to follow, with scope to test the 130-psychological level – which coincides with the 61.8% Fibonacci.
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