EUR/JPY Price Analysis: Retreats to 149.50 even as German data disappoints, BoJ’s Ueda defends QQE
- EUR/JPY takes offers to reverse from intraday low, stays pressured for the second consecutive day.
- German Factory Orders disappoint, BoJ’s Ueda shows readiness to keep QQE until inflation slows.
- One-month-old symmetrical triangle, 200-SMA challenge sellers amid steady RSI.
EUR/JPY bears cheer downbeat German data to portray the second consecutive daily loss near 149.50 heading into Tuesday’s European session. In doing so, the cross-currency pair also ignores dovish comments from Bank of Japan (BoJ) Governor Kazuo Ueda.
That said, Germany’s Factory Orders slumped to -9.9% YoY in April versus -8.9% expected and -11.2% (revised). On the other hand, BoJ’s Ueda signaled that the Japanese central bank will continue QQE until the achievement of the inflation target.
Technically, the cross-currency pair remains on the buyer’s radar due to the previous weeks’ rebound from the convergence of the 200-SMA and the bottom line of a one-month-old symmetrical triangle.
However, the steady RSI (14) line suggests a continuation of the lower grind and hence keeps the sellers hopeful.
With this, the EUR/JPY bears approach the aforementioned triangle’s bottom line, close to 149.15 by the press time, ahead of poking the 200-SMA support level surrounding 148.85.
It’s worth noting that the previous weekly low of around 148.60 also challenges the EUR/JPY sellers before giving them control.
Alternatively, a one-week-old descending resistance line, close to the 150.00 psychological magnet, caps the short-term upside of the pair.
Following that, the stated triangle’s top line near 151.00 will be crucial for the EUR/JPY bulls to cross to regain power.
EUR/JPY: Four-hour chart
Trend: Further recovery expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
