EUR/JPY Price Analysis: The 124.40 region holds the initial test

• EUR/JPY extends the leg lower to the key support near 124.40.
• Immediately to the downside now emerges the 55-day SMA near 123.80.

EUR/JPY accelerated the decline and tested the initial support region around 124.40 earlier on Wednesday.

If the selling impetus gathers further pace, then EUR/JPY could slip back to the 123.80 zone, where sits the 55-day SMA. Further south lines up the 3-month support line (off June’s low), which is considered as the last defence of a test of the key contention area near 122.90.

The constructive view around EUR/JPY is predicted to remain unchanged while above the 200-day SMA at 120.69.

EUR/JPY daily chart