EURJPY has been experiencing a downward trend for the fourth consecutive week, showing signs of bearish control. After reaching the 159.00 level on Wednesday, the currency pair retraced more than half of its September-October uptrend. Despite finding support at the 61.8% Fibonacci retracement level of 159.55, the bears seem determined to keep the pressure on.
Indicators like the RSI, Stochastic, and MACD are not indicating a positive reversal, even though they are near oversold levels. Additionally, the 20-day simple moving average (SMA) has not been able to cross above the 200-day SMA, further supporting the bearish sentiment.
If the selling pressure continues, traders might find support in the 157.60-158.00 region, where the 78.6% Fibonacci mark and ascending trendlines from 2022 are located. A breach of this level could lead to a further decline towards September’s low of 155.13, with a possible drop to 154.20. Any additional declines could see a pause near 153.00.
On the other hand, if the bulls manage to push the pair above 161.00, resistance levels could be found near the 20- and 50-day SMAs around the 163.00-163.30 area. The resistance trendline from July’s high at 164.00 and the 200-day SMA could act as significant barriers, potentially paving the way for a rally to October’s peak at 166.67.
In conclusion, the bearish pressure is likely to persist, especially if EURJPY falls below the 157.60-158.00 support range. Traders should keep a close eye on key levels and indicators to navigate the current market conditions effectively.
