EUR/JPY Technical Analysis: Downturn Risk Seen Ahead
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- EUR/JPY Technical Strategy: Flat
- Support: 144.46, 143.55, 142.08
- Resistance: 145.93, 147.12, 148.31
The Euro may be vulnerable to a turn lower against the Japanese Yen as negative RSI divergence points to fading upside momentum. Near-term support is at 144.46, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 14.6% level at 143.55. Alternatively, a reversal above the 38.2% Fib at 145.93 clears the way for a test of the 50% threshold at 147.12.
The mere presence of RSI divergence is insufficient to identify reversal without added confirmation. As such, we will continue to stand aside for now and wait for a more compelling setup to present itself before committing to a position.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com