EURJPY continues to fall in the descending channel. The market found resistance at the 50-day moving average on March 11, thereby halting the rally that started from 122.06 on March 1. Prices have subsequently fallen since then, remaining below the middle line of the descending channel, trading in a range formation. Prices are mostly bound between the 38.2% and 23.6% Fibonacci retracement levels of the upleg from 122.06 to 127.27. These levels are at 125.30 and 126.08. The 50% Fibonacci is also an important support level that held on Tuesday after the big dip in prices to 124.66.
A move below the 50% Fibonacci could increase downside momentum and indicate a top is in place at 127.27. RSI has just dipped below 50, which indicates a downside bias. The overall outlook is bearish as the market remains below the falling 50 and 200-day moving averages, suggesting that the EURJPY pair has further downside to go.
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