EURJPY has gained buoyancy slightly above the 128.00 level, but the bearish structure of the pair, looks to be unflustered by buyers who recently found their feet at a one-year low within the 127.29-127.50 support band. The falling simple moving averages (SMAs) are endorsing the negative bearing in the pair and the nearing of a bearish crossover of the 200-period SMA by the 100-period one, could signal additional strength to the downside.
Currently, the Ichimoku lines are indicating a stall in downward forces, while the short-term oscillators are transmitting mixed messages in directional momentum. The MACD, in the negative area, is above its red trigger line showing that buyers are fighting back, while the RSI’s improvements in the bearish zone look sluggish. On the other hand, the negative charge in the stochastic oscillator is promoting negative price action in the pair.
In the negative scenario, support below the previous candles low could arise around the red Tenkan-sen line at 128.02. If bearish pressures grow, sellers could then challenge the 127.29-127.50 support section, that has held since the later part of February 2021. If this floor of a larger trading range that has endured since August 2021 fails to dismiss sellers from extending the three-week decline from 133.15, the price may then meet the 127.00 handle before traders’ focus turns to the 126.42-126.68 support band.
Alternatively, if buying interest increases, initial upside hindrance could come from the 128.69 barrier and the adjacent blue Kijun-sen line at 128.79. Overstepping this, the bulls may then face a resistance zone from the 129.00 handle until the 50-period SMA at 129.24, fortified by the Ichimoku cloud’s lower band and a potential restrictive trend line, pulled from the 16-week high of 133.15. Should bullish forces successfully conquer this upside obstacle, the price could steer higher to confront a tough buffer zone between the 129.78 high and the 100-period SMA at 130.28, an area that also encapsulates the 200-period SMA.
Summarizing, EURJPY is sustaining a bearish bearing below the 128.79 boundary, the SMAs and the prospective diagonal resistance barrier. A clear price break below the one-year low of 127.29 would confirm a resumption of the negative bearing. Yet, for optimism to return in the pair, the price wound need to climb north of the 130.28 level.
