EUR/JPY Is in a Downward Correction, Consolidates above Level 129.05

Key Resistance Levels: 132.00, 133.00, 134.00
Key Support Levels: 129.00, 128.00, 126.00

EUR/JPY Price Long-term Trend: Bearish
EUR/JPY pair is trading in the bearish trend zone but consolidates above Level 129.05. The downtrend has been ongoing since May 2021. The currency pair faced rejection at the high of level 134.00. While the downtrend extended to level 127.93. After consolidation above the current support, the pair corrected upward and retested the 134.00 overhead resistance. The market declined again to the low of level 127.38. Meanwhile, on November 29 downtrend; a retraced candle body tested the 50% Fibonacci retracement level. The retracement level indicates that EUR/JPY will fall to level 2.0 Fibonacci extension or 121.33.

Weekly Chart Indicators Reading:
The pair is at level 47 of the Relative Strength Index for period 14. It indicates that the currency pair is trading in the downtrend zone and capable of further downward moves. The 21-day line SMA and the 50-day line SMA are sloping horizontally indicating the sideways move. The pair price bars are below the moving averages indicating the downtrend.

EUR/JPY Medium-term Trend: Bearish
On the daily chart, the pair is below the moving averages. The pair has been declining from the high of level 131.00. Presently, it is fluctuating above level 129.03. The market will fall to the previous low of level 127.00 if price breaks below the current support.

Daily Chart Indicators Reading
The EUR/JPY pair has fallen below the 20% range of the daily stochastic. It implies that the selling pressure is likely to end. The price bars are below the moving averages which makes it capable of falling to the downside.

General Outlook for EUR/JPY
EUR/JPY is in a downward move but consolidates above Level 129.05. The currency pair is consolidating above level 129.00. The upward move will resume if the support holds. Otherwise, the downtrend will resume.


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