Sellers returned to the market and dragged EUR/JPY back to the negative territory on Friday.

The earlier spike met initial hurdle near 133.00 at the end of the week after rebounding from weekly lows in the mid-131.00s. The continuation of the recovery could extend further in the very near term and retest the October high near 133.50 (October 20). This is considered as the last defence for a probable move to the 2021 high past 134.00 the figure (June 1). EUR/JPY has bounced off the 131.52 support and is set to head higher towards the 134.12 June peak. Above here, the pair will target the 137.51 mark, Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, reports. In the broader scenario, while above the 200-day SMA at 130.20, the outlook for the cross is expected to remain constructive.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

On the bullish side EUR/JPY has eased back to and bounced off the 38.2% retracement at 131.52. Attention is back on the 134.12 June peak. Longer-term, a break above the June peak is favoured, and will introduce scope to 137.51. Dips should find initial support 131.55/50 and then at 130.74/46, the September highs and should attempt to reassert its longer term bull trend ahead of here. Below 130.46 lies 128.74, the 6th October low and the 127.94/50, August and September lows and the February 2019 high. 61.8% fibo at 131.64 is the major resistance turned support now which is keeping Euro versus Japanese Yen above the 132.0 price action and aiming to conquer daily high at 134.20. But before the impulsive hike occurs, traders should be mentally ready for the pair to adapt to bearish correction towards exponential moving average 200 in the daily time frame and 38.2% fibo retracement level, which supposedly is a better place to buy EURJPY. 

EURJPY Has Found Support at 132.0

Nov 01 2021