- Safe-haven peers rallied against most G8 currencies, including the euro.
- EUR/JPY plunged over 200 pips on Thursday and lost 1.70%.
- EUR/JPY Price Analysis: It could target 135.30 once the sellers recover 136.85.
The EUR/JPY dipped below the 100-day EMA on Thursday, boosted by dismal US economic data, signaling that second-quarter GDP shrank for the second month in a row, pushing the economy into a “technical recession”. Stock market traders shrugged off the news, but in the FX space, safe-haven peers thrived. EUR/JPY is trading at 136.91, up slightly from 0.02% at the start of the Asian session.
EUR/JPY Price Analysis: Technical Outlook
From a daily chart perspective, EUR/JPY has moved into a neutral-bearish bias. Even though the EUR/JPY 200-day EMA sits at 133.67 below the exchange rate, the 100-day breakout is significant. Still, EUR/JPY sellers need to recapture the July 8 daily low at 136.85, which could be reached as the Relative Strength Index (RSI) is in bearish territory, with enough headroom before hitting higher levels. oversold levels. Once this level is breached, it would open the way for EUR/JPY to move towards 136.00.
EUR/JPY 1 hour chart
The EUR/JPY hourly chart shows that the sellers are losing momentum as the Relative Strength Index (RSI) is in oversold conditions. The cross has bottomed around 163.37, which would be the first level of support, as EUR sellers take a breather. EUR/JPY traders should be aware that the pair could provide momentum towards the confluence of the daily pivot and the 50% Fibonacci retracement around the 137.45-55 area before resuming lower towards the sellers target EUR/JPY at 135.30.