EURJPY Price Analysis: Key Support Broken as Pair Falls Below 38.2% Fibonacci – Action Forex
In a significant turn of events in the financial markets, the EURJPY pair has broken key support levels, causing a stir among traders and analysts alike. The pair, which had been showing signs of bullish momentum since August, is now facing a downward trend that has caught the attention of experts.
Technical Analysis and Market Trends
EURJPY encountered strong resistance near the 38.2% Fibonacci retracement level at 162.30, coinciding with the 50-day simple moving average (SMA). This resistance has led to a downward movement in the pair, with potential support levels at the 20-day SMA at 159.90 and the 23.6% Fibonacci level at 159.30. Further declines could see the pair testing the medium-term uptrend line at 156.80.
On the flip side, a breakthrough above the critical area of 162.30 could pave the way for bullish momentum, potentially pushing the pair towards the 200-day SMA near the 50.0% Fibonacci level at 164.80. A successful rally beyond this point could propel the pair to a three-month high of 166.68.
The technical indicators, including the stochastic oscillators and the RSI, are signaling potential weaknesses in the market. The stochastic oscillators are flattening in the overbought area, while the RSI is pointing downwards above the neutral threshold of 50. These indicators suggest that the market may be overextended and could be due for a correction.
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