EUR/JPY Price Analysis: Eyeing a short-term bullish break through 120.60 confluence barrier

• EUR/JPY regains traction and climbs back closer to a key confluence resistance.
• A sustained break below 120.00 needed to confirm a fresh near-term bearish break.

The EUR/JPY cross reversed an early dip to sub-120.00 level and regained positive traction for the second consecutive session on Thursday. The momentum has now lifted the cross back towards an important confluence resistance, around the 120.60 region.

The mentioned barrier comprises of 100-day SMA, 50% Fibonacci level of the 122.88-118.46 down leg and a five-month-old ascending trend-line support breakpoint. A sustained break through might be seen as a key trigger for bulls and pave the way for additional gains.

The cross then might accelerate the positive move towards reclaiming the 121.00 round-figure mark – coinciding with 61.8% Fibo. level – before eventually darting to test its next major hurdle near the 121.35-40 supply zone, or monthly tops set last week.

Meanwhile, a rejection from the current resistance zone, leading to a subsequent weakness below the key 120.00 psychological mark might shift the near-term bias back in favour of bearish traders and drag the cross further towards the 119.00 round-figure mark.

EUR/JPY daily chart

Technical levels to watch