Euro speculators maintain their position against the yen ahead of the European Central Bank’s policy announcement!
Do you think that the EUR/JPY pair will remain within its range pattern in the following trading sessions?
Or is the pair ready to break through?
EUR/JPY for 4 hours Chart by TradingView
Within a few days, ECB members are widely expected to cut interest rates, which will see the bank’s deposit rate fall by 25 basis points to 3.25%.
But the performance of the Japanese yen is not rising much either, as it is affected by increased demand for the US dollar and improved overall risk sentiment.
The EUR/JPY pair is up about 400 pips so far this month, thanks to European Central Bank members who supported “gradualism” in interest rate cuts.
Remember that directional biases and volatility conditions in market prices are usually driven by fundamentals. If you haven’t done your homework on the EUR and JPY yet, it’s time to check the economic calendar and stay up to date with daily essential news!
Will this week’s topics extend EUR/JPY’s monthly gains?
Note that this pair is trading in a range and the 163.75 resistance range has not been broken since August. Bearish candles and sustained trading below the 162.85 pivot point line expose the pair to a potential move down to the 162.00 psychological level, the 161.50 SMA 100 levels, or the 160.00 medium range area.
Of course, the EUR/JPY may also extend its October uptrend.
Watch for bullish candles above the uptrend line in the 4-hour time frame as this could lead to another retest and perhaps even a flat trade above the R1 pivot point line (163.80) if not the 164.00 psychological level.
Whatever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier market triggers when trading this. good luck!