EUR/JPY Price Analysis: Probes 5-week descending trendline

• EUR/JPY needs to clear a descending trendline to confirm a bull reversal. 
• The daily chart indicators are already reporting a reversal higher. 

EUR/JPY is currently trading at 124.76 – the resistance of the trendline connecting Sept. 1 and Sept. 10 highs. 

A daily close above the trendline would imply an end of the pullback from the Sept. 1 high of 127.07 and confirm bullish reversal signaled earlier this week by the MACD histogram's crossover above zero. 

The 14-day relative strength index has also crossed into bullish territory above 50.

A breakout would expose 125.28 - the 61.8% Fibonacci retracement of the sell-off from 127.07 to 122.38. 

However, a strong rejection at the trendline hurdle could invite chart-driven selling, possibly yielding a decline to 123.84 (Oct. 7 low). 

Daily chart

Trend: Bullish above trendline hurdle

Technical levels