- The Euro was in a solid uptrend until it faced resistance near 124.45 against the Japanese Yen.
- The EURJPY pair recently broke a couple of bullish trend lines at 123.30 on the hourly chart.
- The Euro Zone Sentix Investor Confidence Index for May 2017 released by the Sentix GmbH posted an increase from 23.9 to 27.4.
EURJPY Technical Analysis
The Euro traded with a lot of buying interest this past week, and moved from 121 to 124.40 against the Japanese Yen. The EURJPY pair traded as high as 124.44 where it faced offers, and later moved down.
The pair declined and broke the 50% Fib retracement level of the last wave from the 122.60 low to 124.48 high. It opened the doors for more declines below 122.60.
Later, the pair broke a couple of bullish trend lines at 123.30 on the hourly chart. These trend line were very important near 123.30-40.
EURJPY Hourly Chart
At the moment, the pair is finding support just around the 76.4% Fib retracement level of the last wave from the 122.60 low to 124.48 high.
It may correct a few pips in the near term, but the same trend lines at 123.30-40 may now act as a resistance and prevent an upside move.
On the downside, if the pair break 123.00, there can be a move towards the last swing low at 122.60 where buyers may emerge.
Euro Zone Sentix Investor Confidence Index
Today in the Euro Zone, the Sentix Investor Confidence Index for May 2017 was released by the Sentix GmbH. The market was expecting a minor increase from the last reading of 23.9 to 25.3 in May 2017.
The actual result was a lot better than the forecast, as the Sentix Investor Confidence Index posted a rise from 23.9 to 27.4.
The main point to note from the report published was:
The development in Europe thus decouples strongly from the US economic assessment, which is again declining. With 5.8 points the expectations are only just above the stagnation threshold! There are also signs of fatigue in Asia ex Japan.
Overall, the Euro was not impressed much, which is why EURJPY remains at a risk of further declines below 123.00 in the short term.