EUR/JPY: The market is in the process of consolidating following the break to fresh multi-year lows by 105.40 in the previous week. However, while the price holds below the 20-Day SMA, the overriding trend is still intensely bearish and rallies should be used as an opportunity to sell back into the trend. Only a close back above the 20-Day would negate and give reason for concern. At this point, we can not rule out the possibility for a test of 100.00 should the 105 handle be taken out.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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