EURJPY gained little this week and remained above the 20-day simple moving average (SMA). The price is finding strong resistance obstacle near the 138.00 psychological mark and any advances above this critical level would endorse the positive bias. The RSI is confirming the recent weak to bullish momentum as it is holding above its 50 level, while the stochastic oscillator completed a positive cross within its %K and %D lines.
If the price fails to rise over the 138.00 level, it may fall to the 20-day simple moving average, which is currently at 137.25. The 23.6% Fibonacci retracement level of the up leg from 124.40 to 140.00 at 136.35 may prove significant support for the bears. However, more declines could meet the 40-day SMA at 135.80 ahead of 134.75.
On the flip side, if 138.00 is easily breached, the focus will shift to the almost seven-year peak of 140.00. Bulls would also have to clear the 141.00 round number, which was recorded in May 2015.
After the rally from 124.40, the short-term outlook for the EURJPY turned bullish. The outlook could improve if the market maintains its upward trend above the 140.00 resistance.
