The Euro was seen trading higher recently against the Japanese yen, but found resistance around the 130.80 level. The EURJPY pair is currently testing an important support area, which is around 129.50-60 levels. Let us see whether the pair can continue to hold the mentioned support area or not. A break below the same might ignite losses in the short term. Today, there is a major release in the Euro area, as the Consumer Confidence will be released by the European Commission. The market is expecting the consumer confidence to register a reading of -5.95 in March 2015, compared to the preceding reading of -6.70.
There is a monster bullish trend line formed on the hourly chart of the EURJPY pair, which is serving as a barrier for the Euro sellers. More importantly, the 50% fib retracement level of the last leg from the 128.35 low to 130.70 high is also sitting around the same area. So, there is a major support forming at 129.50. The pair might find bids and trade higher in the near term. An upside acceleration could easily take the pair back towards the 130.00 resistance area. The hourly RSI is above the 50 level, which is a positive sign. Moreover, the EURJPY pair is placed well above the 100 and 200 hour simple moving average. So, let’s see how the pair trades moving ahead.
If the EURJPY pair moves lower, and breaks the highlighted trend line, then it might head towards the 100 hour MA.
Overall, one might consider buying dips in the EURJPY pair as long as it stays above the stated trend line.
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Posted By Simon Ji of IKOFX Technical Team: Online Forex Broker
Website: http://ikofx.com/
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