EURJPY has been in a neutral phase and has not shown a clear trend since early July. The pair has been oscillating around the key 130.00 level in a broad range between 128.00 and 131.00. Following a steep rise from the 124.00 area, prices rose to as high as 131.17 on August 2, a level not seen since early 2016.
Taking a closer look on the 4-hour chart, EURJPY has made a bullish run from the August 11 low of 128.04. After encountering strong resistance from the Ichimoku cloud and at the key 130.00 level, EURJPY managed to break above this level today. The next target is at 130.76, the July 11 high. From here, the multi-month high of 131.17 comes into view. From this point, the longer-term bullish trend would resume.
Otherwise, a drop back below 130.00 would expect support at 129.55 (July 31 low). The bottom of the Ichimoku cloud at 129.02 is another support area ahead of the August 11 low at 128.04. Below this, the medium-term outlook would shift from neutral to bearish. The intra-day bias remains to the upside, with RSI pointing up and having crossed above the 50 level into bullish territory.
