According to Karen Jones, Analyst at Commerzbank, EUR/JPY’s upside attempts will continue to get sold into its 5-month downtrend, currently located at 120.86.

“EUR/JPY’s outlook remains negative while capped by its 5-month downtrend, currently at 120.86. This is reinforced by resistance at 121.45/48 - this is the location of the 200-day ma, the 50% Fibonacci retracement and the late October high. While capped here, attention remains on the 119.48 uptrend. This should hold the initial test, however, longer-term the risk has increased for a break lower. Failure here will target the 117.09 October low ahead of the 115.87 September low. Above the 200 day-ma lies the 123.34 July high.”