Overview: The currency pair is breached the monthly pips at 122.56 during yesterday’s trading session. The pair exchange rate is reversed from the 200- hour simple moving average at 122.38. The market is favoring the bearish momentum and making bears more aggressive nowadays. The daily chart has turned bearish, in so far as the rising trend line from the May and September swing lows have been broken and bearish momentum has accelerated aggressively. The pair is favoring the bears and making negative volatility in the market. the pair is making the lower lows and higher highs at this moment. Technically its making deeper declines in the market.
Technical Analysis: The pair get the bounces off multi-week lows near 121.60. The market is moving towards the south direction. The market is moving towards the downward side and making the downward trend line . The major lines EMA are falling below the SMA lines as the market keeps falling. The pair keep dropping for the following consecutive days. The major pullback is felt in previous days. The EURJPY has been strongly negative in the short and medium-term frame lines. We typically take a contrarian view to crowd sentiment, and the facts traders are net-long suggests price may continue to fall.
The recent changes in the market suggest setting for sell-side as bears are maintaining bearish contrarian trading bias. The current range of the market 122.70 to 122.00. The support is 122.00 followed by 121.60 whereas resistance is 122.90 followed by 123.50. The RSI is the 50 level favoring the bears and a bearish crossover on MACD indicator is showing the strength in the pair.
Trade idea: Based on the chart and above studies we would suggest go for sell 122.45 targets 121.90 and 121.50 stop loss is 123.30.
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