EURJPY: Sees Bear Pressure, Extends Weakness

With the cross failing to follow through higher and closing lower the past week, a follow- through lower is now seen. This will leave EURJPY weakening further towards the 105.63 level followed by the 104.60 level, its April 2012 low. Further down, support lies at the 103.27 level. Its daily RSI is bearish and pointing lower supporting this view. On the upside, the cross will have to break and hold above the 107.99 level to reverse its present weakness and bring further recovery towards its key resistance at the 111.42/52 levels. This will resume its broader medium term uptrend. If this occurs, further bullish offensive is expected towards the 112.34 level with a violation of there extending more gains towards the 113.00 and then the 114.14 level, its July 31'2011 high. All in all, EURJPY continues to hold on to its downside vulnerability.