EUR/JPY supported by 125.50, Tokyo closed today

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 21, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    /">EUR/JPY">EUR/JPY has found bids above the 125.50 mid round number in early Asia, last at 125.66, with market liquidity today much thinner than usual due to the Japanese bank holiday of Vernal equinox day.

    BOJ caps further upside in EUR/JPY

    From a fundamental standpoint, Valeria Bednarik, Chief Analyst at FXStreet, had the following to say about the pair: "The JPY strengthened after the BOJ stood pat on rates, although it downgraded its economic outlook and inflation expectations. Broad dollar's weakness and the Yen appreciating to 110.66 against the greenback, on the back of FED's announcement, triggered some rumors of a possible BOJ's intervention, leading to a slide in the Japanese currency by the end of the week."

    EUR/JPY technicals

    Technically, looking at the daily chart, Valeria notes that on balance risks are skewed slightly towards the downside, "as the price stands well below a sharply bearish 100 DMA around 128.80, which additionally has accelerated below the 200 DMA", the Analyst said.

    Valeria adds: "In the same chart, the Momentum indicator aims slightly higher within positive territory, but the RSI heads lower around its mid-line, favoring further declines on a break below 125.08, the weekly low."
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