The EUR/JPY pair has been trading downwards since the 7th of June 2016, with the bears driving the price from as high as 122.70 to as low as 119.00, as the yen remains underpinned by risk-off sentiment.
The cross consolidated downwards around 120.83 on Friday, ending the day at 120.10. Today, the pair extended its downward trajectory to three-and-a-half year lows of 119.08, but bounced off at the start of the European session, currently trading at 119.50.
Markets remain cautious ahead of the Federal Reserve and the Bank of Japan interest rate decision due on Wednesday and Thursday respectively.
In the event that the pair breaks above 119.87, the price could reach 120.10 and 120.41 respectively.
On the flip side, in the scenario where the price breaks below 119.08, the pair could reach 118.76 and 118.31 in extension.
Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.