Re-Test Level: 163.80-89
The EUR/JPY is gaining strength after positive German data. It dropped to a low of 163.79 yesterday and is now trading around 164.46. The intraday outlook is bullish as long as the support level at 163 holds.
October Update: Germany's Ifo Business Climate Index rose to 86.5 from 85.4 in September, breaking a four-month downward trend and reflecting better business sentiment. This increase beat analysts' expectations and hints at a more hopeful outlook for the fourth quarter, though economic challenges remain, including recession fears and a projected 0.2% decline in economic output for 2024.
Technical Analysis
The pair is currently above the 34- and 55 EMA, as well as the 365 Hull moving average on the 4-hour chart.
Near-Term Resistance: Around 165. A breakout here could lead to targets of 166.66 and 167.47 (38.2% Fibonacci retracement from 175.41 and 154.40).
Immediate Support: At 163.70. If this level is breached, the pair could drop to 163, 162.70, 162, 161.80, 161.20, 160.65, 160, 159, or 158.35.
Indicator Analysis (4-hour chart)
- CCI (50): Bullish
- Average Directional Movement Index: Neutral
Overall, indicators suggest a bearish trend.
Trading Recommendation
Consider buying on dips around 164, with a stop loss at 163, aiming for take profit levels at 165.78 or 167.
