EURJPY : REBOUND CONTINUES, THE FUNDAMENTALS TELL ANOTHER STORY
- The market has been trading above a bullish trendline since March 2024 ; the mid-term trend is then bullish.
- Lately, the market has registered a strong bullish acceleration that drove prices to the 171.591 level.
However, as the BOJ moved towards the end of the negative rates era, investors have quickly regained appetite for the Japanese Yen, which resulted in a sharp price pullback for the EURJPY pair.
The market quickly came back towards its mid-term bullish trendline before registering another rebound.
This time, the rise seems to be much more stable as volatility has significantly reduced on this pair.
Both moving averages turn bullish while the RSI indicator still doesn't show any sign of a trend slowdown so far.
- This is seen as a bullish configuration. The market is continuing its rebound following its latest impact over the mid-term bullish trendline, and technical indicators seem to confirm this scenario.
However, even if new targets towards 167.818, 168.710 and 170.00 remain valid so far, the latest macro developments may push investors to stay cautious.
Indeed, the monetary tightening cycle in Japan will be long and has just started, which should boost appetite for the Japanese Yen on the longer-term.
In addition, the BoE is yet to start its monetary easing cycle, with first rate cuts widely expected in June, which should also decrease investors' interest for the single currency.
Pierre Veyret, Technical Analyst at ActivTrades
The information provided does not constitute investment research. The material has no been prepared in accordance with the legal requirements designed to promote the independence of investment research and such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
- Lately, the market has registered a strong bullish acceleration that drove prices to the 171.591 level.
However, as the BOJ moved towards the end of the negative rates era, investors have quickly regained appetite for the Japanese Yen, which resulted in a sharp price pullback for the EURJPY pair.
The market quickly came back towards its mid-term bullish trendline before registering another rebound.
This time, the rise seems to be much more stable as volatility has significantly reduced on this pair.
Both moving averages turn bullish while the RSI indicator still doesn't show any sign of a trend slowdown so far.
- This is seen as a bullish configuration. The market is continuing its rebound following its latest impact over the mid-term bullish trendline, and technical indicators seem to confirm this scenario.
However, even if new targets towards 167.818, 168.710 and 170.00 remain valid so far, the latest macro developments may push investors to stay cautious.
Indeed, the monetary tightening cycle in Japan will be long and has just started, which should boost appetite for the Japanese Yen on the longer-term.
In addition, the BoE is yet to start its monetary easing cycle, with first rate cuts widely expected in June, which should also decrease investors' interest for the single currency.
Pierre Veyret, Technical Analyst at ActivTrades
The information provided does not constitute investment research. The material has no been prepared in accordance with the legal requirements designed to promote the independence of investment research and such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.