EUR/JPY technical analysis: Defends support at 120.78, bias remains bearish

• EUR/JPY is bid after seven-day losing streak. 
• The outlook remains bearis despite defense of 120.78. 
• Dsaily chart shows a channel breakdown. 

EUR/JPY is currently trading at 120.93, reprresenting marginal gans on the day, having printed losses in the previous seven trading days.

The pair has again bounced up from the June 3 low 120.78, having defended the key support in the previous two trading days. Even so, it is too early to call a bullish move, as the channel breakdown confirmed on July 18 is still valid.

The 14-day relative strength index is reporting bearish conditions with a below-50 print and the falling moving average convergence divergence (MACD) histogram is signaling a strong bearish momentum. 

All-in-all, the odds appear stacked in favor of a drop below 120.78. That would expose the psychological support of 120.00.

A daily close above Friday’s high of 121.28 is needed to invalidate the bearish setup. 

Daily chart

Trend: Bearish

Pivot points