#EURJPY @ 146.845 has pursued consolidation ahead of possible BOJ intervention. (Pivot Orderbook analysis)

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• EUR/JPY has pursued consolidation ahead of possible BOJ intervention.
• Japan officials have warned risks of deflation due to global demand shock.
• According to a Reuters poll, the ECB is set to announce a 75 bps rate next week.

The pair currently trades last at 146.845.

The previous day high was 147.2 while the previous day low was 145.82. The daily 38.2% Fib levels comes at 146.67, expected to provide support. Similarly, the daily 61.8% fib level is at 146.35, expected to provide support.

The EUR/JPY pair is hanging around 147.00 after a mild correction from a fresh seven-year high at 147.25. The asset is expected to pursue a rangebound structure as investors are awaiting fresh developments on the Bank of Japan (BOJ)’s intervention plans in the currency market to support yen against speculative forex moves.

Continuous warnings from Japan’s officials of potential intervention have kept investors on the sidelines as the supportive move for Japan will trigger volatility in the yen-linked FX pair. Chatters over possible BOJ’s intervention heated after the Japanese yen fell to its record lows near 150.00 against the dollar in the past 32 years.

On Wednesday, Japan’s Finance Minister Shunichi Suzuki, and BOJ’s Governor Haruhiko Kuroda crossed wires, citing that Japan’s economy is vulnerable to external demand shock, which could tip it back to deflation. This clears the fact that the concept of policy tightening is far from thought.

This week, Japan’s Consumer Price Index (CPI) data will remain in the spotlight. As per the projections, the headline CPI could move to 3.1% vs. the prior release of 3.0%. While the core CPI could accelerate to 2% against the former print of 1.6%.

On the Eurozone front, the odds for a bigger rate hike by the European Central Bank (ECB) are skyrocketing. A Reuters poll on ECB’s rate hike extent states that ECB President Christine Lagarde will step up the interest rates by 75 basis points (bps) on October 27. As the European Harmonized Index of Consumer Prices (HICP) is trading at 5x than the targeted rate of 2%, efficiency in policy tightening is highly required.

Technical Levels: Supports and Resistances

EURJPY currently trading at 146.88 at the time of writing. Pair opened at 147.12 and is trading with a change of -0.16 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 142.17, 50 SMA 140.71, 100 SMA @ 140.3 and 200 SMA @ 136.64.

The previous day high was 147.2 while the previous day low was 145.82. The daily 38.2% Fib levels comes at 146.67, expected to provide support. Similarly, the daily 61.8% fib level is at 146.35, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 146.23, 145.34, 144.85
• Pivot resistance is noted at 147.61, 148.09, 148.98

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