In the early hours of Monday during the Asian trading session, EUR/JPY commenced trading with a notable bearish gap, opening at 157.503. This abrupt shift in market sentiment followed comments made by Bank of Japan Governor, Kazuo Ueda, which have sparked speculation regarding the potential end of the negative interest rate policy (NIRP) in Japan.
Ueda's statements included the following remarks: "Once we're confident that Japan is experiencing sustained increases in inflation coupled with wage growth, there are a range of actions we can consider," and "If we determine that Japan can achieve its inflation target even without negative rates, we will take such action."
The market exhibited bearish signals that became evident starting from August 10, 2023, and persisted until August 31, 2023. This period was characterized by a swift and pronounced bearish trend. Despite some attempts, the price failed to recover to its previous highs from the previous week. A critical support level to watch lies within the range of 156.864 to 157.269. Additionally, the Relative Strength Index (RSI) has dipped below the 50 threshold, indicating a bearish sentiment and hinting at a potential move toward oversold conditions. Another potential bearish signal comes from the impending convergence of the Exponential Moving Average (EMA) 50 and EMA 200, which is known as a "death cross."
These market dynamics suggest a cautious approach, as the recent comments and technical indicators point towards a bearish reversal in the EURJPY currency pair.
Tuesday, September 12 2023
Wednesday September 13 2023
Thursday, September 14 2023
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