EUR-JPY Breaks Key Supports, Heads Lower

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( fxtechstrategy.com) -- Having broken and held below key supports at the medium-term trendline of 107.75 and the daily exponential moving average of 106.79, the risk is for EUR-JPY to weaken further in the days ahead.

This development will leave the cross targeting the 105.63 level, its March 6 low. A breach of here will pave the way for a push further lower toward the Dec. 9 high of 104.49, and then the 103.27 level. Its daily and weekly RSI are bearish and pointing lower supporting this view.

The alternative scenario will be for the cross to break and hold above the 111.42/52 levels. If this occurs, further bullish offensive is expected toward the 112.34 level with a violation of there extending more gains toward the 113.00 and then the July 31 high of 114.14 level.

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All in all, EURJPY continues to hold on to its downside vulnerability as it looks to weaken further possibly toward the next key support.

Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces The Professional Suite for his subscribers. He provides full coverage of the forex market with specific focus on G10 currencies as well as the commodities markets, with focus on five key commodities.