Looking at the chart on the weekly time frame, we see how the EUR/JPY pair progresses to higher levels on the chart. The pair made a break above the moving averages of the MA200 and EMA200 very important indicators for determining the trend’s next direction. By setting the Fibonacci retracement level, we see how the pair finds support on the Fibonacci 50.0% level n 126.00. We can now expect the EUR/JPY pair to continue further towards the Fibonacci 61.8% level at 128.70. For something like that, we first need a break above 127.50. The bearish scenario only comes into play if the pair drops below 125.00 and by moving averages to the bearish side.
On the daily time frame, we see that the chart forms a trend line merging the previous lows at the bottom. The EUR/JPY pair has support in the moving averages MA20 and EMA20, and MA50, which is a good sign for further continuation of the bullish trends. We can look at the bearish side if we see the break trend line and how the pair will behave if it falls to the 125.00 level. We are on the bullish side for now, and so we can look at the chart, and now we expect a break above the previous high at 127.50. after that, we can expect the pair to climb close to 128.00.
In the four-hour time frame, we see the formation of a triangle on the graph and how the pair’s movement narrows in the corner of that triangle. This signifies that there will soon be a major shift in the chart outside the top line or vice versa. EUR/JPY is now close to the top line and is likely to break above and climb to 128.00, where it was last in December 2018. If there is too much pressure on the euro and we see a break below the bottom line of the channel, then we can expect a couple of drops to 125.00 and tethers the psychological level on a chart that matches the upcoming moving averages of the MA200 and EMA200.
From some news for these two currencies, we will single out the following: Producer prices in Japan increased by 0.4 percent compared to the month in January. The Bank of Japan announced on Wednesday – in line with expectations after a 0.5-month increase in December. Annual producer prices fell 1.6 percent – again in line with forecasts after sinking 2.0 percent in the previous month.
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