EUR/JPY Price Analysis: Bulls Prepare To Break Out Of 143.40s Resistance. The EUR/JPY currency pair has been showing signs of bullish momentum in recent weeks, as it prepares to break out of key resistance levels around 143.40. This follows a period of consolidation in which the pair traded within a tight range, as traders and investors awaited further developments in the global economic landscape.
One of the main drivers of the EUR/JPY pair’s recent bullish momentum has been the improved sentiment around global economic growth, following positive economic data releases from major economies such as the US and China. This has led to increased risk appetite among investors, which has benefited the euro and other riskier currencies.
Another factor that has contributed to the pair’s bullish momentum is the ongoing weakness of the Japanese yen, which has been driven by the Bank of Japan’s policy of keeping interest rates low and maintaining a loose monetary policy. This has made the yen less attractive to investors, who have been seeking higher yields in other currencies.
From a technical analysis perspective, the EUR/JPY pair is currently trading above its 50-day moving average, which suggests a bullish trend in the medium term. The pair has also formed a bullish flag pattern, which indicates a potential continuation of the uptrend. In addition, the pair has recently broken through key resistance levels around 141.50, which suggests that the bulls are in control and could push the pair higher in the near term.
“EUR/JPY Price Analysis”However, traders and investors should be cautious, as the market sentiment can quickly shift in response to any unexpected news or events. One potential risk factor for the EUR/JPY pair is the ongoing uncertainty surrounding Brexit and its potential impact on the eurozone economy. Any negative news related to Brexit could lead to a sell-off in the euro, which could impact the pair’s performance.
Another risk factor is the ongoing coronavirus outbreak, which has caused disruptions to global trade and economic activity. The outbreak has led to a slowdown in China’s economy, which has had knock-on effects on other countries that rely on Chinese exports. As a major trading partner of China, Japan could also be impacted by the outbreak, which could lead to a flight to safety in the Japanese yen.
In conclusion, the EUR/JPY pair is showing signs of bullish momentum as it prepares to break out of key resistance levels around 143.40. This is driven by improved sentiment around global economic growth and the ongoing weakness of the Japanese yen. However, traders and investors should remain cautious, as the market sentiment can quickly shift in response to any unexpected news or events. They should closely monitor the key economic data and news announcements that could impact the pair’s performance.