FXStreet (Guatemala) – EUR/JPY is currently trading at 130.007 with a high of 130.30 and a low of 129.81.
Despite the recent recovery, EUR/JPY’s downside prevails while we lead into the ECB meeting this week. It is widely expected that the ECB will indeed expand the QE programme and cut the deposit rate although some analysts expect surprises. Meanwhile, the Yen is not out of the woods itself with inflation pressures in Japan evidenced that that may force the hand of the BoJ at some stage, who remain stubborn and optimistic for their inflation target to still be met in the said time frame.
EUR/JPY levels
Technically, Karen Jones, chief analyst at Commerzbank explained that EUR/JPY is about to encounter the base of the 5 month channel at 129.38 and the 78.6% retracement at 129.28. “We also note the presence of a TD perfected set up on the daily chart and a 13 count. All 3 suggest the downside is limited – we would tighten stops on shorts/exit positions.
Rallies will find initial resistance offered by a near term resistance line at 130.88 and the 20 day ma, this is at 131.47 today, and while capped here the market will remain offered. Above here lies the 132.26 last weeks high and 133.18/45, where the late September and early October lows were made.”
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