FxWirePro: EUR/JPY poised for further downside, focus on German inflation data for impetus

Spot Analysis:

EUR/JPY was trading 0.26% lower on the day at 139.95 at around 06:20 GMT

Previous Week's High/ Low: 142.93/ 139.98

Previous Session's High/ Low: 141.89/ 139.98

Fundamental Overview:

Hawkish concerns surrounding the Bank of Japan (BOJ) keep the yen buoyed, weighing on the pair.

BOJ is considering raising its inflation forecasts in January to show price growth close to its 2% target in fiscal 2023 and 2024, reports from Nikkei Asia showed on Friday.

Strong BOJ inflation forecast, along with the latest tweak in the Yield Curve Control (YCC) policy, and the central bank’s multiple market interventions in the last few days keep bearish bias intact.

Technical Analysis:

- EUR/JPY has closed below 200-DMA 

- GMMA indicator shows major and minor trend are bearish

- Momentum is bearish and volatility is high

- Recovery attempts remains caped at 21-EMA

Major Support and Resistance Levels:

Support - 139.23 (38.2% Fib), Resistance - 140.43 (200-DMA)

Summary: EUR/JPY is poised for further downside. Dip till 139.23 likely, more weakness n break below. Bearish invalidation likely on retrace above 200-DMA.