The EUR/JPY pared some of its gains on board-based Euro weakness. It hit an intraday high of 162.12 and is currently trading around 161.61. The intraday outlook is bearish as long as the resistance 162.50 holds.
The Bundesrat of Germany will cast a vote on a €500 billion economic stimulus package following its approval by the Bundestag. The package, which has been termed a historic move, entails huge investment in infrastructure, with €100 billion being allotted for climate measures. It also relaxes constitutional borrowing restrictions to allow increased defense spending as well as assistance to Ukraine. The program is aimed at stimulating economic growth, creating jobs, and improving Germany's infrastructure
Technical Analysis:
The EUR/JPY pair is trading above the 34,55 EMA and 200-4H EMA in the 8-hour chart.
- Near-Term Resistance: Around 162.50 a breakout here could lead to targets at 163/164.20/165/166.65/167.
- Immediate Support: At 161.50– if breached, the pair could fall to 160.40/ 162.30/161.80/160.75/59.70/159.25/158.85.
Indicator Analysis 4-hour chart): - CCI (50): Bearish
- Average Directional Movement Index: Neutral
Overall, the indicators suggest bullish trend
Trading Recommendation:
It is good to sell on rallies around 162.50-55 with a stop loss at 163.20 for a TP of 160.60.
