EUR/JPY Price Analysis: Bearish Doji at multi-year top prods buyers near 155.00
- EUR/JPY prints the first daily loss in six as it retreats from the highest levels since September 2008.
- Bearish candlestick formation, overbought RSI joins looming bear cross on MACD to lure sellers.
- Bullish channel, convergence of 50-SMA, short-term rising trend line favor bulls.
EUR/JPY pares intraday losses within a short-term bullish channel as it prints the first daily fall in six. In doing so, the cross-currency pair retreats from the highest levels since September 2008, marked the previous day, to lure the sellers amid sluggish markets due to the US holiday.
That said, the quote formed a bearish Doji candlestick at the multi-year high while challenging a three-day-old ascending trend channel bullish chart pattern.
It’s worth noting that the placement of the Doji near the highest levels in many months joins the overbought RSI conditions and a looming bear cross on the MACD indicator to suggest a consolidation of the latest gains by the EUR/JPY pair.
However, a clear downside break of the stated bullish channel’s bottom line, close to 154.80 at the latest, becomes necessary for the pair sellers to retake control.
Even so, a convergence of the 50-SMA and a rising trend line from June 07, close to 151.50-45, appears a tough nut to crack for the EUR/JPY bears.
Meanwhile, EUR/JPY rebound may initially aim for the latest peak of around 155.30 ahead of challenging the stated bullish channel’s peak of around 156.10.
Following that, the September 2008 peak of around 156.85 and the 160.00 round figure will be in the spotlight.
Overall, EUR/JPY remains bullish despite the latest signals suggesting a pullback in the prices.
EUR/JPY: Four-hour chart
Trend: Limited downside expected