EUR/JPY hits 2-months lows and rebounds to 120.00

The EUR/JPY pair is about to post the lowest daily close in two months. On the positive side for the euro, the pair trimmed losses during the American session and moved away from the lows. 

On European hours, the pair bottomed at 119.53, the lowest since December 5 and then rebounded and recovered ground. So far the pair has been unable to regain levels on top of the 120.00 handle. Currently, is trading slightly below that area. 

The upside move that took place since the European session was boosted by a weak recovery of the Euro and a retreat of the Japanese yen across the board. 

Technical outlook 

Valeria Bednarik, Chief Analyst at FXStreet notes that the pair is trading around the 38.2% retracement of its latest bullish run and technical readings point for further slides, “given that in the 4 hours chart, the price moved further below its 100 and 200 SMAs, both above 121.50, whilst technical indicators have resumed their declines around oversold territory after a modest upward correction.”

She notes that the 100-day moving average stands at 119.40, offering a strong dynamic support, “with a break below it opening doors for a continued decline towards the 118.40 region, the next Fibonacci support.”