EUR/JPY to suffer further falls towards 125.92 on a break below 127.26 – Commerzbank

EUR/JPY sold off on Thursday to test the 128.60 mid-July low. The pair is set to hold above the 2020-2021 support line at 127.26, however, a slide below here would introduce scope to the 200-week ma at 125.92, Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, reports.

Negative bias while below the 130.35/55 area

“Intraday Elliott wave counts remain negative and attention has reverted to the 127.94 August low and the 55-week ma at 128.18. We would allow for some profit-taking between here and a 2020-2021 support line at 127.26.”

“Below 127.26 would introduce scope to the 200-week ma at 125.92.”

“Rallies should remain capped 130.35/55 for a negative bias to be maintained.”