The EURJPY pair, currently at a value of 157.703, is stabilizing above the level of 157.00 and has the potential to reach the highest point in its cycle at 158.00.

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• EUR/JPY consolidates above 157.00 and threatens the cycle high at 158.00.

The pair currently trades last at 157.703.

The previous day high was 157.74 while the previous day low was 156.34. The daily 38.2% Fib levels comes at 157.21, expected to provide support. Similarly, the daily 61.8% fib level is at 156.88, expected to provide support.

In Wednesday’s session, the EUR/JPY rose near the 157.70 area on the back of a stronger EUR. On the other hand, the JPY weakened after weak economic activity data, which makes investors foresee the Bank of Japan (BoJ) not hurrying to pivot its monetary policy.

Considering this, the German yields are seeing gains across the curve, helping the European currency trade strong against most of its rivals. The 10-year bond yield rose to 2.47%, while the 2-year yield stands at 3.12% and the 5-year yielding 2.52%, respectively with all three seeing gains of more than 1%.

Moreover, no relevant data will be released from the European block this week, and regarding the next European Central Bank (ECB) decisions expectations, investors await the next set of data. Considering that Christine Lagarde is “open-minded” and that the decision will depend on incoming data regarding the September resolution, markets will closely monitor next week’s Q2 Gross Domestic Product (GDP) and inflation data from July from the European Union.

On the Japanese front, Machine Tool Orders came in at -19.8% YoY in July vs the -21.1% expected and its previous figure in May, tallying a contraction for seven straight months. In that sense, weak economic data supports a more dovish stance of the Bank of Japan (BoJ) which could apply further pressure on the JPY.

Considering the daily chart, the EUR/JPY shows a bullish sentiment for the short term. The Relative Strength Index (RSI), positioned above its midline in positive territory with a northward slope, supports this view along with the positive indication from the Moving Average Convergence Divergence (MACD), which is displaying green bars, pointing towards a strengthening bullish trend. Also, the pair is above the 20,100,200-day SMAs, pointing towards the prevailing strength of the bulls in the larger context.

Support levels: 157.00, 156.00, 155.00.

Resistance levels: 158.00, 158.50, 159.00.

Technical Levels: Supports and Resistances

EURJPY currently trading at 157.71 at the time of writing. Pair opened at 157.09 and is trading with a change of 0.39 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 155.99, 50 SMA 154.78, 100 SMA @ 150.87 and 200 SMA @ 146.82.

The previous day high was 157.74 while the previous day low was 156.34. The daily 38.2% Fib levels comes at 157.21, expected to provide support. Similarly, the daily 61.8% fib level is at 156.88, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 156.37, 155.66, 154.97
• Pivot resistance is noted at 157.77, 158.46, 159.17

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