EUR/JPY testing daily highs

The euro is gaining momentum across the board amid speculations about a possible ECB rate hike before QE ends. At the moment the EUR/JPY is up 1% at 122.80, the highest level since Jan. 30.

ECB speculation

European Central Bank policy makers considered the question of whether interest rates could rise before their bond-buying program comes to an end, according to people familiar with the matter, as reported by Bloomberg. 

Euro-area central-bank officials, who asked not to be identified, said that Governing Council members meeting on March 9 exchanged views on ways of communicating and sequencing an exit from unconventional stimulus. They also added that the council didn’t discuss any specific scenario or timeline and hadn't made any formal decisions on a strategy.

Technical outlook

The daily RSI for the pair is approaching overbought levels, suggesting a short-term correction before the next leg up. Supports for the pair could be found at 122.20 (Fib. 78.6% - Feb. - Mar. fall), followed by 122 (psychological level) and 121.30 (Fib. 61.8%). On the flip side, resistances are aligned at 123 (psychological level/Jan. 30 high), 123.30 (Jan. 27 high) and 123.70 (Jan. 9 high).