Short-term technical outlook on EUR/JPY
Key Levels (1 to 3 days)
- Intermediate resistance: 117.40
- Pivot (key resistance): 117.70
- Supports: 116.40/20 & 115.80/65
- Next resistance: 118.50
Directional Bias (1 to 3 days)
After a trading range of 43 pips in the past 2 days since 03 Oct, the EUR/JPY cross pair is likely to resume its impulsive downleg sequence within a major downtrend phase in place since 01 Feb 2018 high of 136.96 to target the near-term supports at 116.40/20 and 115.80/65 in the first step as long as the 117.70 key short-term pivotal resistance is not surpassed.
However, a clearance with an hourly close above 117.70 invalidates the bearish scenario for another round of corrective rebound to retest the 24/27 Sep 2019 swing high at 118.50.
Since its 03 Sep 2019 high of 119.82, EUR/JPY has been evolving within a minor descending channel with its upper boundary now acting as a resistance at 117.40.
The daily RSI oscillator is now testing a significant ascending support at the 40 level where a break below revives the momentum-term downside momentum.
The 117.70 key short-term resistance is defined by the former minor range support from 23 Sep/01 Oct 2019 and the 23.6% Fibonacci retracement of the on-going slide from 03 Sep high to 03 Oct 2019 low.
The 115.80/65 significant near-term support is defined by the 03 Sep 2019 swing low, the lower boundary of the minor descending channel and the 1.236 Fibonacci expansion of the slide from 03 Sep high to 23 Sep low projected from 27 Sep 2019 high.