EUR/JPY Price Analysis: Corrective downside could test 120.56

• EUR/JPY is correcting lower following recent 5-week tops near 122.50.
• The knee-jerk could extend to the support line in the mid-120.00s.

After recording fresh multi-week peaks near 122.50 on Wednesday, EUR/JPY has come under some selling pressure and is now hovering around the 122.00 neighbourhood.

The leg lower should be considered corrective only and carries the potential to extend to the 120.50 region, where sits the immediate support line (off June’s low).

As long as the 200-day SMA near 119.80 holds the downside, the outlook on the cross is seen as constructive.

EUR/JPY daily chart