The yen is under pressure after Japanese CPI stressed the need for ultra-easy monetary policy. Get more on this from the 23 February EURJPY Technical Forecast.
23 February, GKFX – The EUR/JPY is biased bullish in Asia, largely due to the soft tone in the Japanese Yen. As of writing, it is trading at 131.75. The Japanese Yen ran into offers after the Japanese data released earlier today showed the Bank of Japan’s 2 percent inflation target remains a distant dream and hence, the central bank will likely refrain from jumping the hawkish G-7 bandwagon.
The nationwide core consumer price index, which includes oil products but excludes volatile fresh food costs, rose 0.9 percent in January from a year earlier, according to Reuters report. The actual print bettered the estimate of 0.8 percent but matched the December figure.
Uptick in stocks is EUR-positive
Meanwhile, the minutes of the European Central Bank (ECB) meeting showed some officials want to drop their easing bias on QE and could do so in the next 2 meetings. Further, the stock markets seem to have regained poise (Dow added 164 points yesterday), thus the common currency could remain well bid against the funding currency JPY.
23 February EURJPY Technical Forecast
A close above 132.50 (10-day MA) would yield a sustained move higher to 133.58 (100-day MA). A violation there would expose 134.43 (50-day MA).
On the downside, breach of support at 131.53 (session low) would open up downside towards 131.29 (previous day’s low) and 131.14 (200-day MA).
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