EUR/JPY Price Analysis: Juggles near 141.50 as yen’s appeal improves amid fears of global banking fiasco

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• EUR/JPY is facing barricades in extending its recovery above 142.00.
• The 20-period EMA at 141.50 is providing a cushion to the Euro bulls.
• An oscillation in the 40.00-60.00 range by the RSI (14) indicates a consolidation for now.

The EUR/JPY pair is continuously struggling to cross the immediate resistance of 142.00. A loss in the upside momentum is favoring a correction as investors are pouring funds into the Japanese Yen amid soaring fears of global banking turmoil.

Bloomberg reported that “Hedge funds held the biggest yen-bearish positions in six months last week, a painful trade as the collapse of Silicon Valley Bank suddenly boosted demand for Japan’s currency as a haven.

The Euro is struggling to gain traction despite a third consecutive 50 basis points (bps) interest rate hike by the European Central Bank (ECB). ECB President Christine Lagarde pushed interest rates to 3.5% despite the debacle of Credit Suisse. The interest rate decision of 50 bps was supported by a promise of a 50bln Swiss Francs infusion into Credit Suisse.

An absence of follow-up buying in the EUR/JPY pair is conveying exhaustion in the upside momentum. The cross is demonstrating an inventory adjustment phase on an hourly scale. It would to early naming it as an accumulation or a distribution amid a volatility contraction.

The 20-period Exponential Moving Average (EMA) at 141.50 is providing a cushion to the Euro bulls.

An oscillation in the 40.00-60.00 range by the Relative Strength Index (RSI) (14) indicates a consolidation for now.

For an upside move, the cross needs to deliver a breakout of the consolidation formed in a 141.50-142.00 range, which will send the major toward March 12 low around 143.00 followed by February 28 low at 143.88.

On the flip side, a downside break below the intraday low at 141.50 would drag the cross toward March 13 low at 139.48. A slippage below the same would expose the asset to January 19 low around 138.00

EUR/JPY hourly chart