Back
3 Apr 2014
EUR/JPY down -0.28% on the day with a dovish ECB
FXStreet (Guatemala) - Currently, EUR/JPY is trading at 142.60, down -0.28% on the day, having posted a daily high at 143.47 and low at 142.30.
EUR/JPY has been taken lower despite deflationary concerns in Japan, when the ECB delivered a dovish statement along with keeping rates on hold at this months ECB meeting. The pair has fallen from above the 143 handle and didn’t start to pick up demand until the 142.40 area.
ECB: Whatever it takes to prevent deflation”?
Strategists at Rabobank explained that in todays press conference, Mr. Draghi used his verbal language skills to calm fears that the ECB would be unwilling to act. He said that the Committee had a rich and ample discussion. The Council talked about a lower deposit rate and about Quantitative Easing. The mentioning of a discussion on QE, and, moreover, the unanimous commitment to the use of unconventional policies in fighting deflation – was new and reassured market participants. However, the explanation to the audience was kept as vague as possible.
Risk-on / Risk-off JPY
Meanwhile, as strategists at Bank of Tokyo Mitsubishi explained, yen selling is still being driven due to risk-on sentiment reflecting improving investor optimism over the outlook for the US economy. “Although potential negative developments in the Ukraine and China still pose some upside risk for the yen”, they then added.
EUR/JPY daily RSI sits at 61.73, in neutral territory
Looking to momentum indicators, the hourly 200 SMA is currently at 143.00, up from the last close at 141.73 and climbing. Over the past 20 days, the exponential average closing price is 141.58, and trending higher.
EUR/JPY Levels
With spot trading at 142.63, we can see next resistance ahead at 142.66 (Daily Classic S1), 142.73 (Yesterday's Low), 142.85 (Hourly 20 EMA), 143.02 (Weekly High) and 143.03 (Daily Open). Support below can be found at 142.48 (Hourly 100 SMA), 142.30 (Daily Classic S2), 142.30 (Daily Low), 142.23 (Weekly Classic R1) and 141.88 (Daily Classic S3).
EUR/JPY has been taken lower despite deflationary concerns in Japan, when the ECB delivered a dovish statement along with keeping rates on hold at this months ECB meeting. The pair has fallen from above the 143 handle and didn’t start to pick up demand until the 142.40 area.
ECB: Whatever it takes to prevent deflation”?
Strategists at Rabobank explained that in todays press conference, Mr. Draghi used his verbal language skills to calm fears that the ECB would be unwilling to act. He said that the Committee had a rich and ample discussion. The Council talked about a lower deposit rate and about Quantitative Easing. The mentioning of a discussion on QE, and, moreover, the unanimous commitment to the use of unconventional policies in fighting deflation – was new and reassured market participants. However, the explanation to the audience was kept as vague as possible.
Risk-on / Risk-off JPY
Meanwhile, as strategists at Bank of Tokyo Mitsubishi explained, yen selling is still being driven due to risk-on sentiment reflecting improving investor optimism over the outlook for the US economy. “Although potential negative developments in the Ukraine and China still pose some upside risk for the yen”, they then added.
EUR/JPY daily RSI sits at 61.73, in neutral territory
Looking to momentum indicators, the hourly 200 SMA is currently at 143.00, up from the last close at 141.73 and climbing. Over the past 20 days, the exponential average closing price is 141.58, and trending higher.
EUR/JPY Levels
With spot trading at 142.63, we can see next resistance ahead at 142.66 (Daily Classic S1), 142.73 (Yesterday's Low), 142.85 (Hourly 20 EMA), 143.02 (Weekly High) and 143.03 (Daily Open). Support below can be found at 142.48 (Hourly 100 SMA), 142.30 (Daily Classic S2), 142.30 (Daily Low), 142.23 (Weekly Classic R1) and 141.88 (Daily Classic S3).