EUR/JPY closes the week neutral above the 20-day SMA

EUR/JPY bulls defended the 20-day SMA, and the cross established itself above 156.00.
Factory orders from June unexpectedly rise by 7%.
BoJ’s hawkish signals and rising Japanese yields may limit the pair’s gains.

Patricio Martín FXStreet

On Friday, the EUR/JPY traded above the 156.00 zone, boosted by a stronger Euro following industrial data from June but still, bullish momentum is limited. On the other hand, the Yen traded mixed against its rivals and its losses are cushioned by the Bank of Japan flashing hawkish signals.

Europe reported robust industrial data but soft Retail sales. Factory Orders in June jumped 7% while markets expected a 2% decline while sales in the Retail sectors declined by 0.3%, a decline higher than the 0.2% expected by the markets. In Friday’s session, the EUR traded with gains against most of its rivals, including the USD, AUD, JPY and GBP.

On the Yen’s side, is Japanese currency seems to be gaining traction on the back of Bank of Japan (BoJ) comments which stated that the benchmark 10-year Japanese Government Bonds (JGB) will widen from 0.5% to 1.0% which pushed Japanse yields to their highest levels since 2014. In that sense, markets may anticipate a potential pivot by the BoJ, but the Yen will remain vulnerable as long as the bank doesn’t take action.

EUR/JPY Levels to watch

As per the daily chart, the technical outlook for EUR/JPY is shifting towards neutral to bearish, with signs of bullish exhaustion becoming evident. The Relative Strength Index (RSI) displays a negative slope above its midline, while the Moving Average Convergence Divergence (MACD) exhibits fading green bars. Additionally, the pair is above the 20,100,200-day SMAs, suggesting that the outlook on the bigger picture favours the EUR.

Support levels: 155.75, 155.00, 154.00.
Resistance levels: 156.50, 157.00, 157.50.

EUR/JPY Daily chart

EUR/JPY

Overview
Today last price	156.07
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	156.07

Trends
Daily SMA20	155.79
Daily SMA50	154.4
Daily SMA100	150.42
Daily SMA200	146.67

Levels
Previous Daily High	157.24
Previous Daily Low	155.53
Previous Weekly High	157.8
Previous Weekly Low	151.41
Previous Monthly High	158.05
Previous Monthly Low	151.41
Daily Fibonacci 38.2%	156.18
Daily Fibonacci 61.8%	156.59
Daily Pivot Point S1	155.32
Daily Pivot Point S2	154.58
Daily Pivot Point S3	153.62
Daily Pivot Point R1	157.03
Daily Pivot Point R2	157.99
Daily Pivot Point R3	158.73

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.