As the EURUSD pair continues to be offered and the USDJPY pair trades sideways, the EURJPY cross remains under pressure. At the time of writing, it was trading flat, seen at around 130.30, but briefly below the 200-day moving average.
Additionally, previous highs and lows are converged here, creating a significant support zone for the euro, between 130.30 - 130.40. If the price closes below the support zone on a daily basis, the medium-term uptrend could be over.
In that scenario, stop-losses of long positions would likely be hit, sending the shared currency further lower, targeting 129.50 in the initial reaction.
On the upside, the resistance could be spotted at 130.60, followed by another selling zone at around 131.50.
Shorter time-frames now appear oversold. Combined with the presence of major support, we might see a little bounce this week.
Earlier in the day, the ECB governor Cristine Lagarde undermined the euro when she repeated that conditions for a rate hike are very unlikely to be met in 2022. Furthermore, she said that any tightening measure now would cause more harm than good.
Additionally, Japanese GDP fell 3% on an annualized basis in the third quarter, way below the -0.8% expected, and it was down from 1.5% in the second quarter. As a result, the quarterly change dropped to -0.8% from 0.4% previously.
EURJPY daily chart 3 PM CET