Chart Of The Day: EUR/JPY

 | May 18, 2021 05:42PM ET

The 133.26 161% Fibonacci extension is coming into view as EUR/JPY continues higher, breaking out of the previous wedge from last month. Risks may be looming for the longs near term, as the RSI has reached overbought. Whenever this has happened in the last few months, it has lead to a near-term pullback. While above the 50-day moving average and the 131.00 levels hold as support, long-term traders shouldn't worry. However, near term, we could be in for a pullback towards the 131.65 level, which is last week's lows, or previous wedge resistance.