EUR/JPY: downside compelling despite risks ahead - FXStreet

Valeria Bednarik, chief analyst at FXStreet explained that after a modest decline at the beginning of the day, the Japanese yen resumed its advance mid US afternoon, as Wall Street pared gains, although holding on to strong gains.  

Key Quotes:

"The EUR/JPY jumped up to 119.13 on EUR's demand, but finally filled its weekly opening gap, and points to continue falling in the short term, as in the 1 hour chart, the price is back below a bearish 100 SMA, whilst the technical indicators head south within negative territory."

"The fact that the JPY is advancing, despite the ongoing risk-off environment, suggest that long positions are building up in the yen, pointing for a continued advance in the currency, in spite of market's sentiment, post-UK´s referendum."

"In the 4 hours chart, the Momentum indicator lags, whilst the RSI heads sharply lower around 42 as the price remains well below its moving average, in line with additional declines, particularly on an extension below 117.05, the immediate support."