Trendline and 100 hour MA loom above
The EURJPY - like many other currency pairs - has seen a modest correction of the major trend in October (in this case to the upside) over the last few days.
For the pair, yesterday the price fell below an upward sloping trendline from the October 9 low and the 100 hour moving average (blue lin chart above). The low today extended toward the 200 hour MA (green line). The price is not traded below its 200 hour moving average since October 10 (bounced on that day). That moving average line currently comes in at 120.358.
The rebound higher today has taken the price back into the black for the day. On the topside, the pair looks back toward a downward sloping trendline connecting the highs from the last few days and the 100 hour moving average at the 120.888.
If the pair can get above those levels, the technicals would look more bulllish.
If the pair stalls against resistance, the battle between the 100 and 200 hour moving average will continue (until that time the shove is made through one of the extremes).
Taking a broader look at the daily chart below, The last month may have been more bullish but the big picture is improving, but there is work to be done.
What I like...
- The price low in September stalled near a lower channel trendline.
- The correction to the October low stalled against the underside of the topside channel trendline
- The price moved above its 100 day moving average in last week's trading at 119.74. That was the 1st break since April. The price remains above that broken moving average
What is not so great for the bulls is:
- The high this week and last week stalled near swing levels in the 120.80-121.373 area. The high this week moved above the upper extreme, but there was little momentum above that 121.373 level
- The price move back below the 120.80 level.
- The 200 day moving average remains a key resistance level above at 1.22197 as is the 38.2% retracement of the move down from the September 2018 high at 122.454.
So overall the rise from the low this month is just a correction of a longer term down trend.
Nevertheless, lows and rebounds develop from better technicals on the daily and the shorter term charts as well. There are some signs of a tilt to the bullish bias. However, the hourly chart will need to turn more bullish by getting above the 200 hour moving average and topside trend line. If it can do it, the upside can be further explored. If it can not a break of the 200 hour MA willl have traders looking back toward a retest of the 100 day MA at 119.74.
The battle is on.
