EURJPY Rises As Bulls Gain Momentum

Euro (EUR) rose against the Japanese Yen (JPY) on Monday, increasing the price of EURJPY to more than 122.00 as bulls seem to gain momentum. The technical bias however remains bearish because of a Lower Low in the ongoing wave.

Technical Analysis

As of this writing, the pair is being traded near 122.15. A support may be noted near 121.68, the swing low of the last major downside move ahead of 121.00, the psychological number and then 119.11, a major horizontal support area.

On the upside, the pair is likely to face a hurdle near 122.95, the intraday high of Friday ahead of 123.36, horizontal resistance area and then 126.46, the swing high of the last major upside rally as demonstrated in the above chart. The technical bias will remain bearish as long as the 126.46 resistance area is intact.

Eurozone Employment & Inflation

Preliminary data from Eurostat showed that the euro area economic growth accelerated more than expected in the first quarter.

Gross domestic product climbed 0.6 percent from prior quarter, following a 0.3 percent rise in the fourth quarter. Economists had forecast the growth rate to improve marginally to 0.4 percent.

Eurozone consumer prices dropped in April on falling energy prices and a slowdown in service costs, another data from the same agency showed.

The harmonized consumer price index fell 0.2 percent annually, after staying flat in March. Prices had declined 0.2 percent in February. Economists had forecast a 0.1 percent drop for April.

Trade Idea

Considering the overall technical and fundamental outlook, buying the pair around current levels could be a good strategy if we get a valid bullish reversal candle on the daily chart.

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Usman Ahmed

Usman Ahmed is an individual forex trader and market analyst. He holds a Masters of Business Administration (MBA) degree. His work includes fundamental and technical reports on various currency pairs, commodity futures and stock markets. His technical analysis features price action strategies.

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