EUR/JPY Price Analysis: Faces a wall of resistance at 130.75, retreats to 130.10s near the 50/100-DMAs

• The EUR/JPY drops from daily highs amid a mixed market mood.
• EUR/JPY faces a wall of resistance around the 130.50-75 area that would be difficult to surpass.
• EUR/JPY Technical Outlook: Neutral-downward biased, as the daily chart shows.

Tuesday’s Price action witnessed a rally short-lived of the EUR/JPY above the 200-day moving average (DMA) at 130.76, followed by a retracement on the back of worsening market mood. At the time of writing, the EUR/JPY is trading at 130.26.

The market sentiment is mixed. Global equities take a hit, as European and US equity indices record losses, except for the FTSE100, IBEX, and Stoxx600. In the FX space, risk-sensitive currencies rise, while safe-haven peers are the laggards in the day.

During the overnight session, the EUR/JPY remained subdued but rallied on improving market mood, stalling around Pitchfork’s borrow trendline around the 130.70.85 region, near the US cash equities open. Following that, geopolitical headlines increased the appetite for the Japanese yen vs. the shared currency.

EUR/JPY Price Forecast: Technical outlook

The EUR/JPY is neutral-biased. The 200-DMA is still above the spot price, but the 50 and the 100-DMAs lie 10-pips below, confirming the abovementioned. However, the confluence of a four-month-old downslope trendline, Pitchfork’s bottom trendline, and the 200-DMA justify the neutral-downward bias, as EUR buyers face a wall of resistance levels ahead.

That said, the EUR/JPY first support level would be the confluence of the 50 and 100-DMAs around the 130.11-19 area. A clear break would expose 130.00, followed by a trip to the January 25 YTD low at 128.24.