XM Group - Analytics

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    Technical Analysis – EURJPY still consolidating but bias turns bearish

    EURJPY is still in consolidation mode but the near term bias is bearish as prices have dipped below the Ichimoku cloud. RSI below 50 points to further weakness but the stochastics may be about to turn positive after being stuck in oversold territory since late August.

    Prices need to reclaim the 136 handle, which coincides with the 200-day moving average and the bottom of the cloud. This would sustain the current sideways trend in the medium term.

    The 50% Fibonacci retracement level of the April-June upleg at 133.55 is the key support level to watch out for on the downside. A break below this level would likely reverse the outlook to a bearish one.

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