EUR/JPY Price Analysis: Cross gains ground with subtle consolidation signs

Source Fxstreet
May 31, 2024 22:21
  • The daily RSI is pointing upwards, hovering around 70, but continuing red bars in the MACD show a trailing consolidation.
  • On the hourly chart, indicators are neutral and reside in the positive terrain.
  • The 20-day SMA at 169.00 serves as an important threshold for sellers.

On Friday's trading session, despite recent downside corrections, the EUR/JPY pair managed to reclaim its stance above 170.00. This indicates a shifting of the bearish momentum observed on Thursday when the pair marked a daily low at 169.00.

The daily Relative Strength Index (RSI) has pivoted, now pointing upwards near 70, suggesting a possible reversal. However, the MACD is still printing red bars, confirming that the pair is in a consolidation phase with limited upside. These mixed signals necessitate following the pair closely to determine if this marks a fresh bullish momentum or merely a pause in a more pronounced downward correction.

EUR/JPY daily chart

On the hourly chart, indicators are maintaining their neutrality, inhabiting the positive territory. This could potentially point to a subtle strengthening of bullish sentiment despite the ongoing consolidation phase.

EUR/JPY hourly chart

Critically, the position of the EUR/JPY pair continues to hover above the significant SMAs. The 20-day SMA at 169.00 in particular stands out as a crucial threshold and sellers must conquer this level to flip the near-term bullish outlook. Should the position fall below this key support level, the 100 and 200-day SMAs provide further safety barriers for potential sellers.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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