EURJPY has been creating a sharp bullish rally over the last six consecutive four-hour sessions, climbing towards the 31-month high of 132.23. The technical indicators are suggesting strong positive bias. The RSI is standing in the overbought zone above the 70 level, while the MACD is holding above its trigger and zero lines in the near-term.
The next strong resistance could come from the September 2018 high at 133.10 before moving towards the 137.50 barrier, this being the peak from January 2018.
Alternatively, if the markets prove overbought and there’s a downside reversal then the first support could be the 23.6% Fibonacci retracement level of the upward wave from 128.28 to 132.23 at 131.30. Slightly beneath this mark, the 20-period simple moving average (SMA) at 131.20 and the 131.00 handle could come next.
Summarizing, EURJPY is advancing with strong momentum and only a significant close beneath the 200-day SMA could shift the outlook to neutral.
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