• The EUR/JPY barely climbs as the Asian session begins.
• Sentiment is tilted positively but remains fragile, so caution is warranted.
• The EUR/JPY might test 142.40s before resuming to the downside, as oscillators (RSI) accelerate downwards.

The EUR/JPY escalates as the Asian Pacific session gets underway on Tuesday. On Monday, the cross-currency pair seesawed in a 100-pip range between 140.60-141.60 during a peaceful trading session, courtesy of a bank holiday in the US. At the time of writing, the EUR/JPY is trading at 141.56, near the top of the abovementioned range.

Futures of Asian stocks prepare to open higher, carrying on Europe’s Monday session mood. Nevertheless, shifted mixed through the North American session, that albeit slow, witnessed a drop in the DAX 40 and the IBEX 35, European bourses.

Some reasons behind a fragile sentiment is the global economy’s slowing down and high inflationary pressures. Investors assess that high energy prices might get the Euro area into a recession, even before that in the States, as rumors that Russia will halt Natural gas flows ahead of the winter looms. That, alongside

EUR/JPY Daily chart

The EUR/JPY daily chart is neutral-upward biased, partly for the 20-day EMA sitting above the exchange rate, just five pips shy of the 142.00 figure. EUR/JPY traders should note that albeit a bullish harami has formed, sellers begin to mount around 142.00, which might send the cross-currency pair tumbling toward the July 1 low at 139.80.

Therefore, the EUR/JPY first resistance would be 142.00. Break above, and  the pair’s next resistance would be the confluence of the R2 daily pivot point and the June 30 high at 142.43.

On the flip side, the EUR/JPY first support would be 141.00. A breach of the latter exposes the 140.00 mark, followed by the July 1 daily low at 139.80.

EUR/JPY Key Technical Levels