- EUR/JPY retraces from session highs at 130.50, hovers around 100-DMA at 130.16.
- The pair trades with a mild bullish bias. decisive close above 100-DMA could see further upside.
- Price action has bounced off 50-DMA support and has broken above 21-EMA.
- Stochs are on verge of rollover from oversold levels and RSI has turned north. We also see bullish +ve DMI crossover on -ve DMI.
- JPY was offered across the board after BoJ's decision to keep yield target unchanged.
- The move has reinforced the view that the ultra-loose monetary policy will remain in place for a long as inflation remains below its 2 percent objective.
- Focus on eurozone preliminary consumer price index (CPI), scheduled for release at 06:00 GMT.
- CPI is expected to rise 2 percent year-on-year in July. The core CPI is seen rising 1 percent. An above-forecast reading could put a strong bid under the EUR.
- Also, eurozone Q2 GDP reading, due at 09:00 GMT will be watched for further impetus.
Support levels - 130.16 (100-DMA), 130.02 (21-EMA), 129.10 (50-DMA)
Resistance levels - 131.06 (50% Fib), 131.35 (May 22 high), 131.73 (50W SMA)
Recommendation: Watch out for close above 100-DMA for further upside.
FxWirePro Currency Strength Index: FxWirePro's Hourly EUR Spot Index was at 45.0161 (Neutral), while Hourly JPY Spot Index was at -188.042 (Bearish) at 0645 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
