EUR/JPY Price Analysis: Probable consolidation ahead of extra gains

• EUR/JPY extends the side-lined theme around 134.00.
• Focus on the potential drop due to overbought conditions.

EUR/JPY looks consolidative in the upper bound of the recent range near the 134.00 neighbourhood.

The continuation of the ongoing consolidation should not be ruled out, nor some bearish moves on the back of the current overbought conditions of the cross.

However, the buying bias stays unchanged and could motivate EUR/JPY to attempt a visit to the September/October 2017 highs in the 134.40/50 band if recent tops are cleared in the near-term. Further gains appear likely as long as the cross remains underpinned by the immediate support line (off the March lows) near 131.40. This area is also reinforced by the proximity of the 50-day SMA (131.46).

In the broader picture, while above the 200-day SMA at 127.19 the broader outlook for the cross should remain constructive.

EUR/JPY daily chart