EUR/JPY Price Analysis: Oscillates around the head-and-shoulders neckline awaits a break

• EUR/JPY tests neckline as the confluence with last year's high of 148.40 poses a challenge for buyers.
• • Pair remains neutrally biased, with RSI and 3-day RoC indicators suggesting a pause in the uptrend.
• • A break above 148.40 confluence could spur a rally towards a new YTD high at 151.61.

The EUR/JPY aims toward the head-and-shoulders neckline after the cross-currency pair cracked the 20-day Exponential Moving Average (EMA) at 147.66. However, it remains shy of achieving a decisive break that could invalidate the pattern. As the Asian session begins, the EUR/JPY is trading at around 147.90s, down 0.06%.

EUR/JPY Price Analysis: Technical outlook

EUR/JPY remains neutrally biased, though in the near term, slightly tilted to the downside. The Relative Strength Index (RSI) indicator suggests the uptrend might pause as the RSI’s turned flat at bullish territory, while the 3-day Rate of Change (RoC), it’s neutral.

Even though the EUR/JPY spot price tests the head-and-shoulders neckline, the pattern remains intact. The confluence of the neckline and the last year’s high of 148.40 can prove challenging for buyers while a good zone for EUR/JPY sellers.

If EUR/JPY falls below the 20-day EMA, that will exacerbate a fall toward the current week’s low of 147.18. A breach of the latter will expose 147.00, followed by the 50-day EMA 146.17, before reaching the March 31 daily high-turned-support.

Conversely, if EUR/JPY breaks above the 148.40 confluence, the EUR/JPY might rally toward a new YTD high at 151.61.

EUR/JPY Price Action – Daily chart