EUR/JPY Price Analysis: Sits near multi-month tops, around 127.00 mark

• EUR/JPY built on the overnight bullish breakout momentum and climbed to multi-month tops.
• The set-up seems tilted in favour of bullish trades and supports prospects for additional gains.
• Meaningful dips below the 126.70 resistance breakpoint might be seen as a buying opportunity.

The EUR/JPY cross added to the previous day's strong positive move and traded with a positive bias through the mid-European session on Tuesday. The momentum pushed the cross to the highest level since early March, though bulls struggled to find acceptance above the 127.00 mark.

That said, the EUR/JPY cross has already confirmed a bullish breakout through a near one-month-old trading range and seems poised to appreciate further. The constructive outlook is further reinforced by bullish oscillators, which are still far from being in the overbought territory.

Some follow-through buying beyond the 127.00-127.10 region will add credence to the bullish bias and lift the EUR/JPY cross further towards the next major hurdle near the 127.40 region. Above the mentioned level, bulls are likely to aim to reclaim the 128.00 round-figure mark.

On the flip side, any meaningful pullback below the 126.70 trading range breakpoint might now be seen as a buying opportunity and remain limited near the 126.25 horizontal support. This is closely followed by the 126.00 mark, which should act as a strong base for the EUR/JPY cross.

Only a sustained weakness below the mentioned support levels will negate prospects for any further gains and prompt some aggressive technical selling. The EUR/JPY cross might then accelerate the fall further towards the key 125.00 psychological mark en-route the 124.40 support zone.

EUR/JPY daily chart

Technical levels to watch