The Euro and British Pound are currently correcting higher against the Japanese Yen. However, both EUR/JPY and GBP/JPY are likely to face many hurdles on the upside.
Important Takeaways for EUR/JPY and GBP/JPY
- The Euro declined to a new monthly low at 114.43 and currently correcting higher against the Japanese Yen.
- There is a rising channel forming with resistance near 115.55 on the hourly chart of EUR/JPY.
- GBP/JPY also traded to a new monthly low at 130.65 and it is currently rising.
- There was a break above a key bearish trend line with resistance near 131.60 on the hourly chart.
EUR/JPY Technical Analysis
In the past few days, the Euro declined heavily from well above the 116.50 level against the Japanese Yen. The EUR/JPY pair broke many important supports near 116.00 and 115.80 to enter a bearish zone.
Besides, there was a close below the 115.50 level and the 50 hourly simple moving average. It traded to a new monthly low at 114.43on FXOpen and it is currently correcting higher.
There was a break above the 115.00 resistance and the 50 hourly simple moving average. The pair broke the 23.6% Fib retracement level of the downward move from the 117.76 high to 114.43 low.
It seems like there is a rising channel forming with resistance near 115.55 on the hourly chart of EUR/JPY. The channel resistance is close to the previous breakdown zone at 115.50.
The next key resistance is near the 116.00 level or the 50% Fib retracement level of the downward move from the 117.76 high to 114.43 low. Any further gains could open the doors for a decent increase in the coming sessions.
Conversely, the pair could fail to continue above the 115.50 and 115.55 resistance levels. A downside break below the channel support at 115.20 may perhaps open the doors for a larger decline towards the 114.60 and 114.50 levels.
GBP/JPY Technical Analysis
The British Pound also followed a similar pattern declined heavily from well above the 135.00 level against the Japanese Yen. The GBP/JPY pair broke many supports near the 133.20 and 132.50 levels.
Moreover, the price settled below the 132.00 level and the 50 hourly simple moving average. The pair traded to a new monthly low at 130.65 and it is currently correcting higher.
There was a break above the 131.40 level and the 50 hourly simple moving average. Besides, there was a break above a key bearish trend line with resistance near 131.60 on the hourly chart.
The pair is now trading near the 23.6% Fib retracement level of the downward move from the 135.44 high to 130.65 low. On the upside, there is a major resistance forming near the 132.00 level (the recent breakdown zone).
Above the 132.00 resistance, the pair could test the 132.50 resistance. Any further gains could lead the pair towards the 133.00 level or the 50% Fib retracement level of the downward move from the 135.44 high to 130.65 low.
Conversely, the GBP/JPY pair might struggle to continue above the 132.00 and 132.50 resistance levels. An initial support on the downside is near the 131.40 level, below which the pair could resume its decline towards the 130.50 and 130.0 support levels.
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