Eurjpy Faces Tough Resistance

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Eurjpy Faces Tough Resistance

Eur/Jpy Faces A Tough Resistance Ahead

It seems that the EUR/JPY has hit a solid roadblock and can't get past the resistance. The EUR/JPY is trading at the top limit of its 10-week range, but it seems that the bulls can't secure a breakout.

EUR/JPY is stuck in a range-bound movement and seems to be trading sideways. However, we have seen in the past that trends can extend and that could also happen in the case of EUR/JPY.

Eur/Jpy To Find Support At 161.70

But, the chances of moving lower are higher and could push the EUR/JPY lower towards the 154s. But to confirm that the bearish phase of EUR/JPY has started, it will need to break below 161.91, which is the low from the 8th of October.

After that, the next key support will be around 161.70, which is the trendline from the past. A break of this will provide confirmation that the EUR/JPY is indeed in the hands of the bears.

Once this happens, the next bearish targets for the EUR/JPY will be around 158.32 and then 158.00. Any more selling at this stage means a revisit to 157.50 and then 157.00.

quick look at the MACD (Moving Average Convergence Divergence) shows a bearish divergence. In simple words, the EUR/JPY price is moving higher while the MACD line is declining. That's a classic sign of bearish divergence and shows that the downside is ahead.

On the flip side, a break above the upper range will confirm that the bullish trend has extended. In that case, a new short-term uptrend will start and push the EUR/JPY towards new highs.

However, a move lower at this stage seems to be a little difficult due to the weakness of the JPY. At the same time, we also need to remember that a rate cut from the ECB is now just around the corner.

Normally, a rate cut from the ECB should be Euro bearish, but it remains to be seen whether that will be the case this time or not.

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