The EUR/JPY is having a good week, registering gains of 2.22% after facing solid resistance around 143.60. Price analysis reveals that the EUR/JPY is in consolidation within a 130 pip range around the 143.00 psychological barriers.
The pair hit a fresh weekly high at 143.67 on Friday, but some of those gains were reversed, leaving the EUR/JPY to rest comfortably above Thursday’s high ahead of the weekend. At the time of writing, the EUR/JPY is exchanging hands at 143.40 after dropping to a low of 142.91.
The EUR/JPY began the week at around the 200-day Exponential Moving Average (EMA) at 140.32 before rallying sharply towards the 142.38 Tuesday high. Since that day, the EUR/JPY has been consolidating in the 142.35-143.65 area, unable to break either side of the range.
On Friday, the EUR/JPY pierced the top of the range, but buyers were unable to hold to its gains, causing a retracement in the pair. As such, the EUR/JPY neutral-to-upward bias still remains intact.
In the event of a break above the range, the next supply area will be 144.00. If this level is broken, the EUR/JPY could rally and test a five-month-old downslope resistance trendline near 144.50/60. This could propel EUR/JPY bulls towards the psychological 145.00 barrier.
On the other hand, a EUR/JPY fall below 142.30 could test the 142.00 figure. A breach of this level would open the door for a move lower to the 141.70/80 area, with the 20, 50, and 100-day EMAs resting inside this range, followed by a fall to the 200-day EMA at 140.44.
The daily chart of EUR/JPY reveals that the pair is trading above all of its major moving averages, suggesting that the pair is in a bullish trend. The Relative Strength Index (RSI) is trading at 62.68, just below the overbought level of 70, indicating that there is still room for the pair to move higher.
The key technical levels for the EUR/JPY are the 144.00 resistance level, the 142.30 support level, and the 142.00 support level. A break above 144.00 could take the pair towards the 145.00 psychological level, while a break below the 142.30 and 142.00 levels could open the door for a move lower towards the 141.70/80 area.
In conclusion, the EUR/JPY is currently in a neutral-to-upward bias, with a break above the 144.00 resistance level potentially taking the pair towards the 145.00 psychological level. Conversely, a break below the 142.30 and 142.00 levels could open the door for a move lower towards the 141.70/80 area.
