EURJPY Technical Outlook

The common currency may remain under pressure against its Japanese counterpart, courtesy of falling inflation expectations. The 21 March EURJPY Technical Outlook shows what level the pair trades currently.

21 March, GKFX – Currently, the Eurozone inflation expectations, as measured by the 5y5y swaps, stands at 1.68 percent- the lowest level since November. The decline will likely keep the bond yields across the Eurozone under pressure.

Meanwhile, the 10-year German-Japan government bond yield spread continues to drop in the Euro-negative manner. As of writing, the spread stands at 54 basis points vs. the recent high of 70 basis points seen on  Feb. 15.

So, the EUR/JPY risks falling below 130.00 in the short-run. The sell-off will likely gather pace if the Fed sounds hawkish, driving the treasury yields higher and equities lower (positive for Yen).

21 March EURJPY Technical Outlook

A close above the 200-day MA of 131.74 would restore bullish view and allow a stronger rally to 132.44 (March 13 high) and 133.14 (50-day MA). On the downside, breach of support at 130.34 (previous day’s low) could yield a sell-off to 129.61 (Monday’s low) and 129.35 (March 5 low).


This article 21 March EURJPY Technical Outlook was written by analysts at GKFX. The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

If such information is acted upon by you then this should be solely at your discretion and GKFX will not be held accountable in any way.

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