It has rejected the channel line resistance several times in the recent past at 133.764.
Retrospectively, prior bearish trend suggests shorting chances by generating some bearish patterns such as spinning top, long legged and gravestone dojis on daily graphs.
The price behavior has formed a sloping channel in which rejections to break resistance at 133.096 levels were observed several times in the recent past.
Most importantly, robust volume build ups along with price slumps confirms downtrend (you can see grey shaded areas on weekly charts).
As a result, both weekly and monthly prices have slipped below 21DMA, hence it could be used as downtrend would drag further. Currently, attempting towards resistance at 133.096 levels.
Leading oscillating indicators are moving in sync with prevailing price declines (see monthly charts for RSI is directly proportionate with price line), this convergence can be attributed as bearish continuation.
Currently, RSI (14) trending near 43.9439 levels (while articulating) with downward convergence to the dipping prices.
There is a clear sign of selling sentiments as a result of overbought pressures, it alarms bears trying to take over the declining rallies as the slow stochastic noises with %D line cross over at 40 levels on weekly (current %D line flashes at 26.8749).
So overall, EUR/JPY is steaming up with heaps of bearish indications by leading oscillators in addition.
Most probable scenario: More downside potential towards 1st target - 129.50, on break below those levels can drag towards even up to 128.05 levels in medium term.
Adverse scenario: Alternatively, if the pair manages to seize any good hints and post some abrupt rallies can be possible maximum upto 133.50 which would again be channel line resistance.
Hedging recommendation: Contemplating certain bearish swings or any abrupt brief upswings, we recommend buying calendar spread that takes care of certain yields regardless of swings.
