EUR/JPY long-term horizon is clouded

FXStreet (Moscow) - EUR/JPY has been falling five trading days out of six, which might support the view that the cross is ready to resume the downside in the long-run.

EUR/JPY will have to come away non the richer

EUR/JPY is on the way of forming lower tops and bottoms on daily chart, which means that some more downside may be in store for us. If we zoom out to the weekly chart, it will become obvious that on a longer-term scale the cross is consolidating with bearish bias and it still has room for downside correction. There are several factors that may support this view: first, EUR is expected to lose its teflon status due to deeper monetary policy divergence between ECB and FED, this will cause its decline across the board; second, EUR decline might be coupled with JPY strengthening on the back of higher volatility that will drive money out of risk assets and right into safe-heavens. To support this view we need to see a sustained weekly close below 137.40/45 that will open up the way to 136.25 (February 4 low)

What are today’s key EUR/JPY levels?

Today's central pivot point can be found at 138.04, with support below at 137.37, 136.83 and 136.16, with resistance above at 138.58, 139.25, and 139.79. Hourly Moving Averages are mixed with the 200SMA at 138.63 and the daily 20EMA at 138.66. Hourly RSI is bearish at 41.