EUR/JPY back below 114.00, still up for the day

EUR/JPY peaked on Wednesday at 114.33, the highest level since Friday and then retreated. Currently, it trades at 113.90, after being unable to hold above 114.00. Today the pair rose for the second day in a row but still remains 700 pips below last week levels.

EUR/JPY technical outlook

The bullish tone prevails in the pair from a very short-term perspective, but a decline below 113.80 - 113.60 (yesterday’s high and the 20-hour moving average) would remove momentum out of the euro.

“The short-term picture is neutral-to-bullish, as in the 1-hour chart, the Momentum indicator remains stuck around the 100 level, whilst the RSI indicator heads modestly lower around 58. In the same chart, the price is hovering around a bearish 100 SMA, still unable to confirm a break above it,” said Valeria Bednarik, Chief Analyst at FXStreet.

According to her the 4-hour chart shows the Momentum indicator heading higher above its 100 level and the RSI holding flat around 48, whilst the 100 and 200 SMAs maintain strong bearish slopes far above the current level. “Should the price extend beyond 114.60, the risk turns towards the upside, with chances then of a steady advance up to 115.45, the post-Brexit high.”