Posted on February 6, 2015 by the XM Investment Research Desk at 8:25 am GMT
A further bounce to the upside would be limited by resistance at 137.62, at which point we could see a resumption of a decline. Meanwhile, a move to the downside from current levels would see a retest of the low at 130.13. A break below this would target the long term Fibonacci retracement level (38.2%) of the upleg from 94.09 to 149.76. This next support level comes in at 128.50.
In the near-term, EURJPY remains bearish below the Ichimoku cloud as can be seen on the daily chart. The tenkan-sen and kijun-sen lines are falling and are negatively aligned. Although the RSI is in bearish territory below 50, it has recently been rising, as the market bounced from 130.13, suggesting a near – term correction and consolidation.