FxWirePro: EUR/JPY recovery lacks traction, 21-EMA offers stiff resistance

EUR/JPY chart - Trading View 

EUR/JPY was trading 0.08% higher on the day at 131.76 at around 05:15 GMT.

The pair is extending gradual grind lower after upside remains capped at 21-EMA.

ECB's dovish outlook is likely to keep upside in the pair limited. Decisive break above 21-EMA required for upside continuation.

ECB President Christine Lagarde said, the economic recovery remained fragile despite upbeat economic readings. The rising inflation is expected to stabilize in the medium term below ECB target.

MACD shows a bearish crossover on signal line on the weekly charts. RSI is below the 50 mark adding to the bearish bias.

The pair is on track to test cloud base at 131.17, breach below will drag the pair lower. Next major supports align at 130.58 (110-EMA) ahead of 129.34 (38.2% Fib).

21-EMA is major resistance at 132.15. Decisive break above 21-EMA and daily cloud will negate any further bearishness.

Markets await  the German Markit Purchase Managers Index (PMI) and Eurozone PMI data for further impetus.