EURJPY Analysis: Highest Since Fall 2008
Yen Weakening Drivers:
→ rising prices for energy resources. After all, Japan is a major importer.
→ The inflation index CGPI (corporate goods price index) indicates a slowdown in inflation. Therefore, this raises the likelihood that the Bank of Japan will maintain an ultra-loose monetary policy.
The growth of the euro against the yen is facilitated by the fact that the ECB is pursuing a tough policy. Market participants expect that another rate increase could be made in autumn.
The EUR/JPY chart shows that the rate is in an uptrend. The market recovered quickly from the sharp decline on July 27, a testament to the strength of demand. Another piece of evidence is the amount of B→C retracement after A→B rises. It was only about 30% of the momentum.
Support levels:
→ 157.85. After the breakout by the bulls, the previous resistance may provide support, as was the case with the 151.55 level, which worked as a resistance in May, but provided support at the end of June;
→ median channel line.
Resistance Levels:
→ upper border of the channel;
→ the psychological level of 160 yen per euro.
Today (at 15:30 GMT+3) inflation news in the US is expected, which can shake financial markets a lot.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
→ rising prices for energy resources. After all, Japan is a major importer.
→ The inflation index CGPI (corporate goods price index) indicates a slowdown in inflation. Therefore, this raises the likelihood that the Bank of Japan will maintain an ultra-loose monetary policy.
The growth of the euro against the yen is facilitated by the fact that the ECB is pursuing a tough policy. Market participants expect that another rate increase could be made in autumn.
The EUR/JPY chart shows that the rate is in an uptrend. The market recovered quickly from the sharp decline on July 27, a testament to the strength of demand. Another piece of evidence is the amount of B→C retracement after A→B rises. It was only about 30% of the momentum.
Support levels:
→ 157.85. After the breakout by the bulls, the previous resistance may provide support, as was the case with the 151.55 level, which worked as a resistance in May, but provided support at the end of June;
→ median channel line.
Resistance Levels:
→ upper border of the channel;
→ the psychological level of 160 yen per euro.
Today (at 15:30 GMT+3) inflation news in the US is expected, which can shake financial markets a lot.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
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