Fri, Mar 24, 2023 @ 21:37 GMT
HomeContributorsTechnical AnalysisEURJPY Retreats Sharply, Eyeing 200-day SMA

EURJPY Retreats Sharply, Eyeing 200-day SMA

EURJPY has been experiencing a decline in the last few daily sessions after its latest advance paused at the 142.30 region.  Moreover, the price is currently trading below its lower Bollinger band and is battling with the crucial 200-day simple moving average (SMA), a violation of which could accelerate the downfall.

The short-term oscillators suggest that negative momentum is strengthening. Specifically, the MACD histogram is losing ground beneath both zero and its red signal line, while the RSI is approaching the 30-oversold area.

Should selling pressure intensify further, the 200-day SMA, currently at 133.60, could act as the first line of defence. Sliding beneath that floor, the price may descend towards the May low of 132.64 before it challenges the 131.60 barrier. Failing to halt there, the bears could then aim for 127.45.

To the upside, if buyers re-emerge and reverse the drop, initial resistance could be encountered at the inside swing low of 136.85. Breaching this ceiling, the spotlight could then turn to the 140.00 psychological mark before the focus shifts to the recent reversal point of 142.30. A jump above the latter might set the stage for the 7½-year high of 144.27.

Overall, EURJPY’s outlook has turned bearish both in the short and medium term, while a dive beneath the 200-day SMA could open the door for a sustained downtrend.
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