• EUR/JPY bounces off recent lows in the 127.50 region.
• Above 129.50 the selling pressure should mitigate somewhat.

Despite the current daily rebound, the outlook for EUR/JPY still falls on the fragile side, to be optimistic.

The continuation of the downtrend remains well on the cards for the time being, although further recovery faces the initial hurdle at the 10-day SMA at 128.92. Further up comes the weekly top around 129.60 (November 24) and if cleared, then the downside pressure is expected to alleviate somewhat.

Looking at the broader picture, the outlook for the cross is expected to remain negative while below the 200-day SMA, today at 130.55.

EUR/JPY daily chart