EUR/JPY technical analysis: In search of a direction between 4H 100MA and 23.6% Fibo.

• EUR/JPY remains on a back foot below 4H 100MA but 23.6% Fibonacci retracement limits immediate downside.
• The lower high formation, comparative JPY strength favor the quote’s decline.

Although 4H 100MA continues to tame the EUR/JPY pair’s post European Central Bank (ECB) decision rally, the quote remains supported by 23.6% Fibonacci retracement of June-end to July downpour as it takes the rounds to 120.94 during the initial Asian session on Monday.

However, comparative fundamental strength of the Japanese Yen (JPY), coupled with lower high formation since the month-start, favor the odds of further downside once the 120.83 immediate support breaks.

In doing so, July 24 high around 120.58 and July 25 low close to 120.00 could become strong supports ahead of the yearly low surrounding 118.85.

On the flipside, pair’s successful break of 100-bar moving average (4H 100MA) at 121.35 caps near-term advances, a break of which can recall 50% Fibonacci retracement level of 121.70 and 122.00 round-figure on the chart.

EUR/JPY 4-hour chart

Trend: Sideways