EUR/JPY technical analysis: Defends support at 120.78, bias remains bearish
- EUR/JPY is bid after seven-day losing streak.
- The outlook remains bearis despite defense of 120.78.
- Dsaily chart shows a channel breakdown.
EUR/JPY is currently trading at 120.93, reprresenting marginal gans on the day, having printed losses in the previous seven trading days.
The pair has again bounced up from the June 3 low 120.78, having defended the key support in the previous two trading days. Even so, it is too early to call a bullish move, as the channel breakdown confirmed on July 18 is still valid.
The 14-day relative strength index is reporting bearish conditions with a below-50 print and the falling moving average convergence divergence (MACD) histogram is signaling a strong bearish momentum.
All-in-all, the odds appear stacked in favor of a drop below 120.78. That would expose the psychological support of 120.00.
A daily close above Friday’s high of 121.28 is needed to invalidate the bearish setup.