- EUR/JPY resumes downtrend after sharp drop in euro.
- Short-term outlook could turn negative below 139.25.
EUR/JPY quickly erases Monday’s rally and breaks below 140.00 to post fresh three-week lows.
If the selling pressure picks up, it could challenge the current short-term bullish bias. That said, if the cross breaks the four-month support line near 139.25, it could open the door for a deeper pullback to initially the 55-day SMA today at 138.80 before the June low at 137.83 ( June 16).
In the longer term, the constructive stance on the cross remains well supported by the 200-day SMA at 132.94.
EUR/JPY day chart
Source: Fx Street
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