The safe-haven Yen in Tuesday's trading rebounded against most other major currencies in the market. Is this a sign that market sentiment has recovered?
It is too early to assess the risks of the crisis between Russia and Ukraine has subsided. In fact, tensions will increase with the intervention of Europe and the United States (US) which imposed sanctions on Russia when they did not like Russia's actions which are seen as violating international law.
However, the depreciation of the Yen that took place yesterday was seen as a market reaction to a statement by the President of Ukraine, Volodymyr Zelensky who believes that war will not happen.
Investors are also likely to see an opportunity to enter a trade at a better price by first taking profits on previous positions.
As observed on the price movement on the EUR/JPY chart, the price has made a decline at the beginning of the week up to the price support zone around 129.400.
On the price increase happened again in the European session yesterday tested the level of 130.700 which is zib SBR (support become resistance) but failed to break.
Prices receded and moved flat until the end of the New York session and remained slow above the Moving Average 50 (MA50) support level in the 1 -hour time frame until the trade continued into the Asian session and the beginning of the European session today (Wednesday).
The SBR 130.700 zone will still be valued for price testing for investors to get further price movement indicators.
If market sentiment recovers and affects the Yen, the price is expected to break the resistance at the SBR 130.700 zone and test the SBR 131.600 zone.
The higher rise that will continue will lead up to the 133.00 zone which is the highest level reached by the price in this 3 -month trading period.
On the other hand, if the price resumes its bearish pattern, the support zone of 129.400 will be broken for a lower decline heading towards the zone of 128.400 to 128.00.
