EURJPY is tackling the fresh near 16-month high of 126.20 after a recent bounce on the cloud’s upper surface repowered the positive incline. The Ichimoku lines currently reflect a pause in the ascent, while the rising simple moving averages (SMAs) command a clear bullish bearing.
Glancing at the short-term oscillators, they too reflect some stalling in the positive momentum. The MACD, in the positive section, has marginally smoothed above its red trigger, while the stochastic lines flirt with the overbought region, barely dipping under the 80 mark. That said, the RSI is rising just above 70, promoting further advances.
If buyers manage to overcome the immediate impeding 126.20 barrier, the pair may rise to challenge the critical 126.80 border from April of 2019. Improving further, the 127.49 high from March 2019 could attempt to halt the climb ahead of the 128.36 level, that being the 176.4% Fibonacci extension of the down leg from 124.42 to 119.30. Triumphing above this point, the 129.24 key peak from December 2018 may draw traders’ focus.
Should sellers take control, initial constrictions may occur at the 125.58 barrier and around the slightly lower blue Kijun-sen of 125.24, prior to the 50-period SMA of 125.00 located at the ceiling of the cloud. If the pair continues to fade, the crucial support section from 124.00 to 124.25, which involves the 100-period SMA and the floor of the cloud, could come under pressure. Undergoing further weakening, the price may dive for the 123.32 low before confronting another tough limiting band from 122.83 to 123.00, where the 200-period SMA resides.
Summarizing, for the uptrend to continue to dictate the short-term bias, the price would be required to sustain its bearing above the SMAs and the 124.00-124.25 region. Improving above 126.80 may repower this positive outlook.