16 Oct 2013
EUR/JPY soars as safe-haven demand wanes
FXstreet.com (Athens) – The EUR/JPY is moving in the upper level since the kick-off of the early European trading session, despite the soft European data and amidst the US fiscal budget impasse.
The EUR/JPY is heading straightly upwards since the early European trading session despite the fact that the fiscal melodrama continues. What’s more, the single currency was also offered little help by the EZ data. Indeed, inflation pressure was totally absent in September, showing that Euro land CPI was at its lowest levels for the past 3.5 years on the first month of the fall, while on a yearly basis was announced also at the very soft 1.1%. Taken for granted the very soft inflation data it is comprehensible that ECB is very difficult to avoid another LTRO policy in the future. All in all, it seems that market participants have already priced in a solution at the US fiscal political drama even at the 12th hour.
Technical Aspects on the EUR/JPY
Axel Rudolph, Head Technical Analyst at Commerzbank suggests that the “EUR/JPY’s recent advance has taken it to the May peak at 133.82 which provoked a sell-off, though. The August high at 132.42 is thus back in focus. Below it lies the early September high at 132.14. Still further down sit the breached one month resistance line at 131.63 and the 55 day moving average at 131.61.We will retain our short term bearish outlook while 133.82 caps. Only if unexpectedly bettered, will the September high at 134.95 be back on the map. Only a fall below the 131.15 current October low will trigger losses to127.97 August low.”
The EUR/JPY is heading straightly upwards since the early European trading session despite the fact that the fiscal melodrama continues. What’s more, the single currency was also offered little help by the EZ data. Indeed, inflation pressure was totally absent in September, showing that Euro land CPI was at its lowest levels for the past 3.5 years on the first month of the fall, while on a yearly basis was announced also at the very soft 1.1%. Taken for granted the very soft inflation data it is comprehensible that ECB is very difficult to avoid another LTRO policy in the future. All in all, it seems that market participants have already priced in a solution at the US fiscal political drama even at the 12th hour.
Technical Aspects on the EUR/JPY
Axel Rudolph, Head Technical Analyst at Commerzbank suggests that the “EUR/JPY’s recent advance has taken it to the May peak at 133.82 which provoked a sell-off, though. The August high at 132.42 is thus back in focus. Below it lies the early September high at 132.14. Still further down sit the breached one month resistance line at 131.63 and the 55 day moving average at 131.61.We will retain our short term bearish outlook while 133.82 caps. Only if unexpectedly bettered, will the September high at 134.95 be back on the map. Only a fall below the 131.15 current October low will trigger losses to127.97 August low.”