EUR/JPY: technical analysis 04.06.20
EUR against the Japanese yen today continues to consolidate in the side channel 122.038-122.489 after significant growth over the last days. If the "bulls" manage to raise the rate above the level of 122.615, the growth may continue to the area of 123.000. This level can prevent the instrument from growing, as the possibility of the reverse of the price is high there. Meanwhile, the breakout of 123.000 could trigger a pair’s active growth to the area of high 123.300.
The pullback below 121.875 will be a sign of the downward correction development and let the price decline to the area of 121.500-121.365. The key target of the correction is the level of 121.094, which corresponds to the middle line of Bollinger Bands. This level can activate an upward rebound of the price. Meanwhile, the breakdown of 121.094 and the pair’s sustained trading below 121.000 will be a signal of the downward trend resumption. In this case, the sellers will aim for the 120.700 support.
Technical indicators mostly keep a buy signal, but the downward correction is possible in the short term.
Bollinger Bands are diverging on the background of bullish momentum.
MACD volumes are decreasing in the positive zone.
Stochastic has left the overbought area and is pointed downwards, reflecting the high possibility of the downward movement formation.
Support and resistance
Support levels: 121.875, 121.500, 121.365, 121.000.
Resistance levels: 122.615, 123.000, 123.300.
Short positions can be opened below the level of 121.875 with the target at around 121.500 and stop-loss at 122.000.
Long positions can be opened above the level of 122.615 with the target at around 123.000 and stop-loss at 122.486.