EURJPY is rebounding off the 23.6% Fibonacci retracement level of the up leg from 124.40 to 144.25 at 139.55 and is returning above the 140.00 round number.
According to the MACD, negative momentum could push for further losses in the short-term as the indicator tries to fall below its trigger line. However, the RSI is advancing and is holding above its neutral threshold of 50, confirming the latest bullish movement.
On the upside, resistance could occur around the more-than-seven-year-high of 144.25 ahead of the high of December 2014 at 149.25. Higher still, the inside swing low of March 2008 at 151.70 would increasingly come into scope.
Further declines may meet support around the 140.00 psychological mark and the 23.6% Fibonacci of 139.55. Not far below, support could come from the three-month uptrend line around 138.00. Even lower, a break of the diagonal line may open the way for a test of the 40-day simple moving average (SMA) near 137.60, ahead of the 38.2% Fibonacci of 136.75.
Overall, the very short-term outlook appears mostly bearish, but the broader outlook remains bullish for the most part.
Source: Melina Deltas, CFTe – XM Group