EUR/JPY holds above 200DMA in 130.50s in quiet Monday trade as BoJ rate decision looms


  • EUR/JPY held above its 200DMA at 130.58 on Monday in quiet, US holiday-thinned trade due to MLK Day.
  • Traders are focused on the upcoming BoJ policy meeting, amid expectations for inflation/growth upgrades and potentially hawkish chatter.

EUR/JPY has stabilised to the north of its 200-day moving average at 130.58 on Monday in quiet trade with US markets shut for MLK Day. Volumes are expected to pick up during the upcoming Asia Pacific session with the BoJ set to announce policy. No changes to the central bank’s ultra-dovish stance is expected, but sources have hinted that 1) inflation and growth forecasts could be lifted and 2) some BoJ policymakers are keen to discuss the conditions for a reduction of stimulus. Indeed, hawkish chatter from BoJ sources last week ahead of the upcoming meeting was one reason why EUR/JPY fell briefly below 130.0 last week.

However, EUR/JPY’s dip last week below the big figure was used as an opportunity to add to long positions by bulls and those seeking to play the range. Seemingly traders did not see hawkish BoJ chatter as reason enough to push EUR/JPY back into its late-November/most-of-December 127.50-129.50ish ranges and the fundamentals do back this up. Yes, global equities have weakened since the start of the year as a result of monetary policy tightening fears (mostly regarding a potentially overly aggressive Fed) and this has contributed to EUR/JPY pulling back from recent highs above 131.50.

But Fed tightening fears, which have pushed US bond yields substantially higher since the start of the year, are also exerting hawkish pressure on Eurozone money and bond markets. Despite assurances from “core” ECB policymakers (like President Christine Lagarde and Chief Economist Philip Lane) that the conditions for a rate hike will not be met in 2022, money markets are pricing 20bps of tightening by the end of 2022 (and 10bps by October). Meanwhile, the German 10-year is probing 0.0%, up nearly 40bps from its December lows. Recent fundamental developments thus clearly favour EUR/JPY remaining in its recent 130.00-131.50ish range, barring a significant turnaround in Eurozone yields or ECB rate hike bets.

EUR/Jpy

Overview
Today last price 130.69
Today Daily Change 0.34
Today Daily Change % 0.26
Today daily open 130.35
 
Trends
Daily SMA20 130.28
Daily SMA50 129.49
Daily SMA100 130.02
Daily SMA200 130.58
 
Levels
Previous Daily High 130.86
Previous Daily Low 129.78
Previous Weekly High 131.48
Previous Weekly Low 129.78
Previous Monthly High 131.04
Previous Monthly Low 127.38
Daily Fibonacci 38.2% 130.19
Daily Fibonacci 61.8% 130.45
Daily Pivot Point S1 129.8
Daily Pivot Point S2 129.25
Daily Pivot Point S3 128.72
Daily Pivot Point R1 130.88
Daily Pivot Point R2 131.4
Daily Pivot Point R3 131.95

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD retreats toward 1.0550 as dollar rebounds

EUR/USD retreats toward 1.0550 as dollar rebounds

EUR/USD has lost its traction in the American session and retreated to the 1.0550 area. In the absence of high-tier macroeconomic data releases, the dollar is staging a rebound with the US Dollar Index rising above 103.00 and forcing the pair to edge lower.

EUR/USD News

GBP/USD consolidates its weekly gains below 1.2500

GBP/USD consolidates its weekly gains below 1.2500

GBP/USD has extended its sideways grind below 1.2500 into the second half of the day on Friday with the dollar staying resilient against its rivals. Nevertheless, the pair remains on track to snap a four-week losing streak.

GBP/USD News

Gold loses traction, drops below $1,840

Gold loses traction, drops below $1,840

Gold came under modest bearish pressure in the American session on Friday and dropped below $1,840. The benchmark 10-year US Treasury bond yield stays quiet above 2.8%, helping XAU/USD limit its losses ahead of the weekend.

Gold News

Bitcoin price will bounce to $36,000, but what happens next will leave you shocked

Bitcoin price will bounce to $36,000, but what happens next will leave you shocked

A brief technical and on-chain analysis on Bitcoin price. Here, analysts evaluate where BTC could be heading next. Does the possibility for a cat bounce make sense?

Read more

PANW shows bullish reversal chart pattern after earnings beat

PANW shows bullish reversal chart pattern after earnings beat

PANW stock benefits from continued strong revenue growth. Palo Alto Networks now nearly services half of the Global 2000. PANW stock is showing a bullish reversal pattern on its daily chart.

Read more

Forex MAJORS

Cryptocurrencies

Signatures