21 Jul 2015
EUR/JPY: Bears headed for danger zone?
FXStreet (Guatemala) - EUR/JPY is currently trading at 135.37 with a high of 135.54 and a low of 134.41.
EUR/JPY is riding dollar weakness on a light calendar and profit taking while the herd follows one another, possibly offering a sell on rallies on a short squeeze in EUR/JPY and a long squeeze in the greenback, although penetrating through key technical resistance in EUR/JPY on the short term sticks.
EUR/USD was the driver, rallying up from 1.0820 support to post over 120 pips so far on the bid albeit meeting some supply currently. The saving grace for the cross comes with broad dollar weakness and this equates so far of 60 pips in the red for USD/JPY, down from 124.40 resistance. However, has a habit of correcting further and faster than the euro which could equate to further upside in the cross and through 135.80 would be poor luck for the bears in stop territory.
From the calendar, we are lacking on the domestic front although the industrial production didn't aid the dollar with June industrial production +0.2% vs +0.3% that was initially reported while capacity utilisation lowered to 77.8% from 78.4%. Meanwhile, Kuroda says that he expects the Japanese inflation rate to accelerate in coming months and that the inflation target will be met by 2016.
EUR/JPY is technically on a rebound from supporting 3-month uptrend territory and a continued drift up towards 136.00 threatens prospects of the 200 DMA, as Karen Jones, chief analyst at Commerzbank suggested here.
EUR/JPY is riding dollar weakness on a light calendar and profit taking while the herd follows one another, possibly offering a sell on rallies on a short squeeze in EUR/JPY and a long squeeze in the greenback, although penetrating through key technical resistance in EUR/JPY on the short term sticks.
EUR/USD was the driver, rallying up from 1.0820 support to post over 120 pips so far on the bid albeit meeting some supply currently. The saving grace for the cross comes with broad dollar weakness and this equates so far of 60 pips in the red for USD/JPY, down from 124.40 resistance. However, has a habit of correcting further and faster than the euro which could equate to further upside in the cross and through 135.80 would be poor luck for the bears in stop territory.
From the calendar, we are lacking on the domestic front although the industrial production didn't aid the dollar with June industrial production +0.2% vs +0.3% that was initially reported while capacity utilisation lowered to 77.8% from 78.4%. Meanwhile, Kuroda says that he expects the Japanese inflation rate to accelerate in coming months and that the inflation target will be met by 2016.
EUR/JPY is technically on a rebound from supporting 3-month uptrend territory and a continued drift up towards 136.00 threatens prospects of the 200 DMA, as Karen Jones, chief analyst at Commerzbank suggested here.