Today we would direct our attention to the EUR/JPY currency pair. It has been moving in an upwards direction since May this year, and despite some fluctuations here and there, this still remains the general trend.
The pair is currently seeing some volatility because we are awaiting a speech by the ECB chief Mario Draghi, as well as the CPI release from the eurozone. In Japan we received news that the Bank of Japan is firmly supporting a dovish policy for the near future, which would allow the yen to ease on most currencies.
Right now we have a pivot point for the price located at 132.86. Below the pivot lie the support levels of 132.6, 132.21, and 131.56. Just above the pivot we have the nearby resistance levels at 133.25, 133.52, and 134.17. Here we can apply the general rule for price movements: if the price falls below the pivot, expect it to touch the support levels; if it goes above the pivot, then the resistances might be overcome.
As of the moment of this article’s publication the EUR/JPY is trading around 133.08, which is above the pivot and close to the first resistance level. Although the various technical indicators are giving us some mixed signals, most favor taking a sell position right now. Our general outlook for the pair is bullish.
