- EUR/JPY rejected at 100-DMA, slips lower from 133 handle after failing to extend gains above.
- Series of mixed Euro area PMI releases capped the EUR recovery and triggered fresh selling interest.
- Monetary policy divergence back in play ahead of the European Central Bank (ECB) policy decision due later this Thursday.
- The pair is extending sideways, finds strong support at 200-DMA (132.25), we see weakness on break below.
- Technical indicators do not show clear directional bias. RSI flat, but holds above 50 levels.
- Price action capped between 100 and 200 DMAs. Breakout on either side could determine further direction.
- Break above 100-DMA finds next major resistance at cloud top at 133.42. Break above cloud will propel the pair higher.
- On the downside, immediate support aligns at 200-DMA at 132.25. Violation at 200-DMA will see drag till major trendline support at 130.20 ahead of 38.2% Fib at 128.85.
Support levels - 132.25 (200-DMA), 131.50 (cloud base), 130.80 (Apr 12 low)
Resistance levels - 132.43 (5-DMA), 133.01 (100-DMA), 133.42 (Cloud top), 134.40 (trendline)
Recommendation: We prefer to wait for clear directional bias.
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