- EUR / JPY remains on the defensive around 131.50.
- Immediate containment appears at recent lows around 131.00.
EUR / JPY hit fresh three-week lows near 131.00 on Thursday. Despite the subsequent rebound from that area, the cross remains well entrenched in negative territory on Friday.
The loss of 131.50 on a sustainable basis – where the recent lows and a Fibonacci retracement (from the October rally) coincide – should open the door for a deeper retracement to the 131.00 region, where another Fibo nacci level lies at 130.97. Lower from here comes the September high around 130.75 followed by the mid 130.50 zone (September 29 high).
In the broader scenario, as long as it remains above the 200-day SMA at 130.34, the outlook for the crossover is expected to remain constructive.
EUR / JPY day chart
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