EUR/USD corrected lower after it struggled to clear the 1.2250 resistance level. USD/JPY is trading above 103.20 and it is likely setting up for the next major move.
Important Takeaways for EUR/USD and USD/JPY
- The Euro seems to be facing a strong resistance near 1.2250 and 1.2260.
- There is a major bullish trend line forming with support near 1.2160 on the hourly chart of EUR/USD.
- USD/JPY is rising steadily and it is well above the 103.20 support level.
- There is a key contracting triangle forming with support near 103.45 on the hourly chart.
EUR/USD Technical Analysis
In the past few days, there were swing moves in the Euro above 1.2200 against the US Dollar. The EUR/USD pair made a couple of attempt to gain strength above 1.2250 and 1.2260, but it failed.
The recent swing high was formed near 1.2256 on FXOpen before the price started a fresh decline. There was a break below the 1.2200 support level and the 50 hourly simple moving average. The pair even broke the 1.2180 support, but it stayed above the 1.2150 zone.
A low is formed near 1.2152 and the pair is currently rising. It broke the 23.6% Fib retracement level of the recent decline from the 1.2256 high to 1.2152 low.
On the upside, the first major resistance is near the 1.2200 level and the 50 hourly simple moving average. The 50% Fib retracement level of the recent decline from the 1.2256 high to 1.2152 low is also near 1.2205.
A clear break above the 1.2200 resistance zone could lead the pair towards the main 1.2230 level and a connecting bearish trend line. Any more upsides might increase the chances of a break above 1.2260.
Conversely, the pair could start a fresh decline below the 1.2165 support. The main support is near the 1.2150 zone, and a major bullish trend line forming with support near 1.2160 on the hourly chart of EUR/USD. A break below the trend line support could lead the pair towards the 1.2100 level.
USD/JPY Technical Analysis
The US Dollar started a fresh increase from the 103.00 support zone against the Japanese Yen. The USD/JPY pair broke the 103.20 zone to move into a positive zone.
The pair even broke the 103.50 level and the 50 hourly simple moving average. The recent high was formed near 103.73 before the pair started a downside correction.
There was a break below the 103.55 level. The pair also declined below the 50% Fib retracement level of the upward move from the 103.31 low to 103.73 high. It is now trading near a major support at 103.45. There is also a key contracting triangle forming with support near 103.45 on the hourly chart.
If there is a downside break below the trend line, there is a risk of a larger decline towards the 103.20 and 103.00 levels.
On the upside, the first major resistance is near the 103.65 level. A clear break above the 103.65 zone is needed to start a steady rise towards the 104.00 and 104.20 levels.
Any more gains could lead the USD/JPY pair towards the 104.50 level, where the bulls are likely to face a strong resistance in the near term.