EURJPY is currently showing signs of upward movement, with the bulls gearing up to challenge the recent 165.34 high. Despite attempts by the bears to push the pair lower, the ascending trendline from December 7, 2023, has remained intact. The threat of intervention from Japanese officials, along with the upcoming BoJ meeting and dovish remarks from ECB members, suggests that the market could experience increased volatility in the near future.
While momentum indicators indicate a bullish bias, the trend remains somewhat unclear. The RSI is hovering above its midpoint, and the stochastic oscillator is attempting to enter overbought territory. However, the ADX is lagging below the 25-threshold, suggesting a lack of clear direction in the market.
If the bulls manage to overcome the intervention threat, they may target a break above the 165.34 high, aiming for the July 13, 2007, high at 168.93. On the other hand, the bears could attempt to push EURJPY below the 164.29-164.97 area, testing support at the 50-day SMA (163.19) and the 100-day SMA (160.93). A successful break below these levels could lead to further downside towards the 159.64-159.80 range.
Overall, while the bullish momentum is present in the EURJPY currency pair, the threat of intervention and conflicting market signals suggest a cautious approach. Traders should closely monitor key resistance and support levels to gauge the next potential market direction.
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