The interesting movement on the price chart of the EUR/JPY currency pair stole the attention of investors when expectations for the price increase failed to continue yesterday following the positive momentum at the end of last week.
Investment flows towards safe-haven assets earlier in the week were seen to increase influenced by uncertainty in China over the issue of the Evergrande debt crisis.
Thus, the situation has prompted the appreciation of the Yen currency in Monday's trading yesterday. But the momentum began to fade following cautious investors ahead of Japan's central bank's monetary policy meeting on Wednesday.
As usual, investors will continue to expect policy easing to be maintained by the Bank of Japan (BOJ) as in previous meetings.
Meanwhile, the Euro has continued to move weakly from last week to this week with the focus on data on major European economic sectors to be displayed on Thursday and Friday.
The price on the EUR/JPY chart is seen to have continued yesterday's decline breaking the support level of 128.600 and recording yesterday's daily low around 128.150.
However, the Yen, which is seen again moving lower in the market, saw a rebound in the Asian session today (Tuesday) testing the 128,600 level which acts as a resistance level for the price.
The SBR (support become resistance) zone is expected to restrain the price increase before the price is expected to resume the decline to the 128.00 support zone.
If the support zone also supports the price in the decline last August. If the price manages to get past this zone, the latest lows will be recorded since February.
However, if the price manages to jump past the SBR 128,600 zone, the Moving Average 50 (MA50) barrier will be passed to signal a change in the bullish trend again.
The bulls will retest the highs reached last Friday around 129.650 before reaching the 130.00 focus level.
