EURJPY plummeted to a new four-month low of 121.80 earlier today, continuing the selling interest from the 123.75 resistance zone. The pair also dropped beneath the 20- and 40-simple moving averages (SMAs), which recently posted a bearish cross, while the stochastic oscillator slipped into the oversold area. Moreover, the RSI is ready to cross below the 30 level in the 4-hour chart.
Another move to the downside below the intraday low could drive the pair towards the 120.60 support level, identified by the low on April 2017. Steeper declines could open the way until the 118.57 bottom, registered on January 3.
In case of upside pressures, the market could meet resistance at the 122.07 level before heading towards the 20-period moving average currently at 122.40. A successful run above this line could see a test of the 40-SMA around 122.70 and the 122.80 resistance zone.
In the short-term, EURJPY has been in a downward movement over the last month and sellers are looking to extend the bearish structure.
