- The EUR/JPY went back on Wednesday in the middle of the appearance of some purchases of JPY.
- The expectations of a rise in the Boj’s rates and the fears of a commercial war continue to underpin the safe refuge jpy.
- The technical configuration favors bassists and supports the prospects of a new fall.
The EUR/JPY crossing fails to capitalize on the night rebound from the mid -161.00 zone and attracts some intradic vendors during the Asian session on Wednesday. Cash prices go back near the round figure of 162.00 in the last hour and seem vulnerable to weakening even more amid the appearance of some purchases around the Japanese Yen (JPY).
Despite a generally positive tone around stock markets, the expectations that the Bank of Japan (BOJ) will raise interest rates this year this year continue to prop up the JPY. In addition to this, the persistent concerns about the possible economic repercussions of the commercial policies of the president of the US, Donald Trump, further benefit the status of safe refuge of the JPY and contribute to limit the increase of the EUR/JPY crossing.
From a technical perspective, the recent repeated failures near the region of 164.70-164.80, which coincides with the simple mobile average (SMA) of 200 days, constitute the formation of multiple roofs in the daily chart. That said, neutral oscillators in the daily graphic justify some caution before opening bearish positions around the EUR/JPY crossing before the European Central Bank meeting (ECB) on Thursday.
Meanwhile, the area of 161.55-161.50, or the weekly minimum touched on Monday, could continue to offer some support before the 161.00 round figure. Some continuation sales will reaffirm the negative bias and will make the EUR/JPY crossing vulnerable to accelerate the fall towards the intermediate support of 160.60 en route to the psychological brand of 160.00 and the area of 159.70-159.65, or the monthly minimum.
On the positive side, the maximum of the night, around the area of 162.70, could act as an immediate obstacle before the 163.00 mark. A sustained force beyond the latter could trigger a short coverage rally towards the horizontal resistance of 163.65-163.70 before the EUR/JPY crossing aims to recover the 164.00 mark. The impulse could extend even more towards the 200 -day Pivotal Pivotal resistance test, around the 164.50 zone.
EUR/JPY DAILY GRAPH
Economic indicator
Interest rate of the main BCE financing operations
The interest rate of the main refinancing operations, one of the three key interest rates established by the European Central Bank (ECB), is the interest rate that the ECB charges banks for loans for a week. The European Central Bank announces it in its eight scheduled annual meetings. If the ECB provides that inflation will increase, it will increase its interest rates to reduce them again to its 2%target. This is usually positive for the euro (EUR), as it attracts more foreign capital tickets. Similarly, if the ECB sees that inflation falls, it can reduce the interest rate of the main refinancing operations to encourage banks to borrow and lend more, hoping to boost economic growth. This tends to weaken the euro, since it reduces its attraction as a place for investors to parquer capital.
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Next publication:
Mark Jan 30, 2025 13:15
Frequency:
Irregular
Dear:
2.9%
Previous:
3.15%
Fountain:
European Central Bank
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
