InstaForex

July 22, 2021

Can the EUR/JPY Rising Pattern Survive?

 The price movement on the chart of the EUR/JPY currency pair started to show bullish signals after the price showed a bullish pattern this week.


After last Tuesday's decline hit 128,600 to record the latest 4 -month low, prices began to rise again towards the end of the week.


However, the bullish pattern signals the start of a bullish trend after the price passed the Moving Average 50 (MA50) barrier on the 1 -hour time frame of the movement on the EUR/JPY chart.


Investors however remain wary of Euro trading ahead of the European central bank’s monetary policy meeting today. The expectation for a loose policy maintained by the central bank will have the effect of the re -depreciation of the Euro in the market.


Meanwhile, the Yen weakened as market sentiment recovered slightly, making the attraction to the safe-haven currency fade again as it did with the US dollar.


The rally on the EUR/JPY chart is seen hovering at the level of 130.00 with the expectation that the rise will continue to return to the previous resistance zone at 131.00 which was tested last week.



A rise beyond the zone in turn will push the price target higher so that it can reach the level of around 132,500 again.


On the other hand, if this bullish pattern is just a price correction, the price decline is seen to return to the support level of 128.400.


The level was successfully broken on last February's rise before becoming a support level in March trading.