Home Forex FX Play of the Day: Is EUR/JPY Prepared for a Quick-Time period Reversal?

FX Play of the Day: Is EUR/JPY Prepared for a Quick-Time period Reversal?

FX Play of the Day: Is EUR/JPY Prepared for a Quick-Time period Reversal?


EUR/JPY appears able to bust out of a good consolidation!

Will in the present day’s market themes encourage a short-term bearish reversal for the pair?

In case you missed it, authorities bonds (and different danger belongings, for that matter) have NOT been having a very good week since Fitch downgraded the U.S. sovereign credit score grade from AAA to AA+.

It doesn’t assist the euro that the Eurozone has been printing blended PMIs whereas headline inflation estimate within the area helps much less charge hikes for the European Central Financial institution (ECB).

EUR/JPY 15-min Forex

EUR/JPY 15-min Foreign exchange Chart by TV

The Financial institution of Japan (BOJ) isn’t shrugging off its rising bond yields, although!

Earlier in the present day, the central financial institution introduced one other unscheduled bond-buying operation after its benchmark 10-year word hit a recent nine-year excessive of 0.65%.

Whereas the intervention could assist restrict JPY’s good points, the transfer additionally lowkey highlighted the BOJ’s attentiveness to market costs in addition to the yen’s secure haven standing.

That is most likely why EUR/JPY is flirting with the underside of a short-term consolidation close to 156.25. Primarily based on the lengthy purple candlesticks within the 15-minute timeframe, it’s doable that we’ll see one other spherical of danger aversion through the European session.

It could additionally assist EUR/JPY bears that the 100 SMA has made a bearish crossover towards the 200 SMA.

If the bearish momentum at the beginning of the European session carries over to the U.S. session, then EUR/JPY may discover sufficient sellers to interrupt under the S1 (156.12) Pivot Level stage and head for the S2 (155.56) assist space.

Not too positive about EUR/JPY breaking a spread on its first attempt? It’s also possible to wager on some danger or profit-taking that would push EUR/JPY again to the 156.80 Pivot Level and mid-range line earlier than EUR/JPY sees sufficient promoting strain to make new weekly lows.

What do you suppose? Is EUR/JPY prepared for a bearish reversal?

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