The EURJPY currency pair experienced a decrease in momentum after the Bank of Japan (BoJ) made a hawkish statement.

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• EUR/JPY loses momentum following the Bank of Japan’s (BoJ) hawkish statement.

The pair currently trades last at 156.827.

The previous day high was 158.39 while the previous day low was 157.0. The daily 38.2% Fib levels comes at 157.86, expected to provide resistance. Similarly, the daily 61.8% fib level is at 157.53, expected to provide resistance.

The EUR/JPY cross loses traction below the 157.00 mark during the early European trading hours on Monday. The cross currently trades near 156.65, losing 0.97% for the day. That said, the recent Japanese policymaker’s comment is the main driver for the pair’s movement on Monday. Market players await the key European Central Bank event on Thursday for fresh impetus.

On Friday, the German Harmonised Consumer Price Index (HICP) for August came in at 6.4% YoY, as the market expected whereas the core CPI remained unchanged at 6.1%, Destatis reported on Friday. Furthermore, the Eurozone Gross Domestic Product (GDP) for the second quarter (Q2) grew 0.1% versus 0.3% prior, missing market expectations at 0.3%. The discouraging data might convince the European Central Bank (ECB) to abandon its hawkish stance for the upcoming meeting.

The majority of analysts expect the European Central Bank (ECB) to keep interest rates steady at its September policy meeting on Thursday, according to a Reuters poll. The ECB’s stance is dependent on incoming economic data. However, the recent Bank of Japan (BoJ) recent comment boosts the Japanese Yen (JPY) against its rivals on Monday.

In response to Bank of Japan Governor Kazuo Ueda’s hawkish statements, the Japanese yen (JPY) strengthened broadly and the benchmark 10-year Japanese Government Bond (JGB) yield hit the highest level since January 2014. Ueda stated in the interview on Monday that the central bank could exit its negative interest rate policy when its inflation target of 2% is near. Policymakers also said that the BOJ would have sufficient evidence by the end of the year to evaluate whether interest rates should stay negative.

Moving on, the Eurozone Industrial Production MoM for July will be due on Wednesday. The attention will shift to the European Central Bank (ECB) interest rate decision on Thursday. On Thursday, Japanese Industrial Production for July will be released. Traders will take cues from these figures and find trading opportunities around the EUR/JPY cross.

Technical Levels: Supports and Resistances

EURJPY currently trading at 156.76 at the time of writing. Pair opened at 158.23 and is trading with a change of -0.93 % .

The pair is trading below its 20 Daily moving average @ 158.35, below its 50 Daily moving average @ 157.14 , above its 100 Daily moving average @ 154.01 and above its 200 Daily moving average @ 148.4

The previous day high was 158.39 while the previous day low was 157.0. The daily 38.2% Fib levels comes at 157.86, expected to provide resistance. Similarly, the daily 61.8% fib level is at 157.53, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 157.36, 156.49, 155.97
• Pivot resistance is noted at 158.74, 159.26, 160.13

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