EUR/JPY halted its three-day decline, steadying around 174.30 during Tuesday’s European session. Analysis of the daily chart reveals a rising wedge pattern, suggesting a potential bearish reversal. Moreover, the 14-day Relative Strength Index (RSI) above 70 indicates overbought conditions, signaling a possible correction.
Meanwhile, the Moving Average Convergence Divergence (MACD) line, above both the centerline and signal line, confirms bullish momentum. Traders are advised to monitor potential shifts in momentum in the EUR/JPY pair.
Key resistance looms near the upper boundary of the rising wedge at approximately 174.40. A breakthrough could bolster bullish sentiment, targeting the psychological level at 175.00.
Conversely, support rests near the nine-day Exponential Moving Average (EMA) around 173.52, followed by the wedge’s lower boundary near 173.50. A breach below the latter may trigger a decline towards the psychological support at 170.00, with further downside potentially testing support around 167.60.
The EUR/JPY pair faces a pivotal juncture, influenced by technical patterns and momentum indicators, suggesting varied scenarios for traders to monitor closely.
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