Cloud continues to limit EUR/JPY bulls, bearish resumption likely

 

• Daily cloud, which currently spans 133.44-134.43, continues to limit EUR/JPY bulls, only a close above cloud top will confirm upside bias & put bulls in control.
   
• EUR largely muted on German CPI data for the month of November, which printed as expected, matching the preliminary prints.
   
• The pair has been trading in a narrow 134.21 - 133.29 range since Monday, strong resistance is seen by 200 DMA at 134.09.
   
• Falling wedge formation seen, daily Stochs are in the overbought zone, unwinding likely, multiple Dojis and spinning tops formed show traders unwilling to take the pair higher, bias is definitely lower. 

 

Recommendation: Short rallies around 133.70, SL: 134.50, TP: 132.20
Resistance Levels:

R1: 134.10 (200 DMA) 

R2: 134.23 (Daily High Dec 9)

R3: 134.43 (Daily Cloud Top)

Support Levels: 

S1: 133.22 (Hourly Low Dec 11)

S2: 133.00 (Session Low Dec 11)

S3: 132.78 (Daily Low Dec 10)

S4: 132.18 (Tenkan-Sen)