• EUR/JPY keeps last week’s failures to cross 10-day SMA.
• Bearish MACD backs further downside to six-week-old resistance-turned-support.
• Monthly resistance line adds to the upside filters.

EUR/JPY retreats to 132.81 following a two-day downtrend during early Monday. In doing so, the cross-currency pair extends multiple rejections from 10-day SMA towards retesting the previous resistance line, now support, amid bearish MACD signals.

It should, however, be noted that the pair’s weakness past 132.50 becomes doubtful as an ascending support line from January 18, around 132.20, can test EUR/JPY bears.

Also, a clear downside below 132.20 needs validation from the 132.00 round figure before dragging the quote to May’s low near 131.00.

On the flip side, a daily close beyond the 10-day SMA level of 133.35 will escalate recovery moves to the short-term falling trend line close to 133.70.

During the EUR/JPY price uptrend beyond 133.70, the monthly high near 134.15 and late 2017 tops near 134.50 will be the key to watch.

EUR/JPY daily chart

Trend: Further weakness expected