The EURJPY has been boosted by the European Central Bank press conference after testing support at previous market highs. The ECB held their stimulus measures at current levels, while they refused to make any aggressive statement about a recent surge in the Euro against global currencies.
Traders had been concerned that officials would threaten action against the single currencies recent strength, but they simply said that they would watch the FX market closely. This gave traders a green light to continue buying with future meetings being more likely for such comments. The ECB also kept interest rates at the current level as expected.
Only a day after President Lagarde’s comments on the Euro, the ECB’s Chief Economist, Philip Lane, has urged caution on Europe’s slowing recovery and weak inflation. His comments put further stimulus on the cards for future months. Mr. Lane’s comments will go further to dampen the Euro’s rally, which faded against the dollar later in the session.
Next week sees the Japanese LDP party choosing their new Prime Minister after the resignation of Shinzo Abe. His former right-hand man Yoshihide Suga is in the driving seat and he has pledged continuity of Abe’s policies.
EURJPY Technical Outlook
The EURJPY is looking to push higher after finding support again at the June 5th highs. The pair now trades at 125.75 and the target will be the September 1st highs of 127.07. The 124.50 level is key support and a daily close near here would be bearish. The Investing Cube team is currently available for Trading Coaching. Newer traders may want to start with the Trading Course.
EURJPY Daily Chart