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June 8, 2021

EUR/JPY ‘Rests’ After Reaching Highs Over 3 Years

 The price movement on the chart of the EUR/JPY currency pair started to show a bearish pattern starting at the end of last week again.

If observed, the previous bullish series was blocked at the resistance zone of 134.200 last week before the decline began to take place ahead of last Friday’s NFP jobs report.

Last week’s price increases have also recorded the highest level reached since February 2018 trading.

With the reaction of the depreciation of the US dollar after the NFP report, expect the bearish pattern on the EUR/JPY chart to continue further in trading this week.

It is likely that the movement for the Euro currency is somewhat limited this week as investors are cautious ahead of the outcome of a policy meeting by the European Central Bank (ECB).

After hitting a daily low of around 132.900 yesterday, the rally was seen continuing in the Asian session trading this morning testing the Moving Average 50 (MA50) barrier on the 1 -hour time frame of price movement.

A higher price rise above 133.400 will be seen as an early signal for a reversal of the bullish trend of the price.

For a continued rise, the 134.200 resistance zone will be re -tested for the price to record its latest 3 -year high.

However, if the price just tests the resistance zone and resumes the decline, the price focus level is seen at around 132.500 which is in the RBS zone (resistance become support).

A lower decline beyond that zone is likely to head to the next focus zone around 131,800.