EUR/JPY Daily Forecast

Daily Pivots: (S1) 133.61; (P) 134.21; (R1) 134.84; .

EUR/JPY's fall from 136.87 resumes after brief recovery and dives to as low as 132.37 so far today. At this point, further decline is still expected as long as 134.80 resistance holds. Break of the medium term trend line support is consistent with the view that EUR/JPY has topped out at 139.21. Break of 131.41 support, which will also have EUR/JPY sustained below mentioned trend line, will add much credence to this case and target 124.35 support next. On the upside, above 134.80 will turn intraday outlook neutral first. But risk will now remain on the downside as long as 136.87 resistance holds.

In the bigger picture, rise from 112.10 is treated as part of the consolidation in the larger down trend form 08 high of 169.96 only. Considering bearish divergence condition in daily MACD and RSI, such rise is tentatively treated as completed at 139.21 already. Sustained break of mentioned trend line support from 112.10 will add much credence to this case. Further break of 124.35 will confirm and bring retest of 112.10 low next. Meanwhile, note that another rise cannot be ruled out for the moment since EUR/JPY is still holding above the medium term trend line. But even in case of up trend resumption, upside should be limited by resistance zone of 50% retracement of 169.96 to 112.10 at 141.03 and 61.8% retracement at 147.85 and finally bring reversal.

Based on ActionForex.com Technical Outlook