#EURJPY @ 147.013 has established above 147.00 as a hawkish ECB would widen ECB-BOJ policy divergence. (Pivot Orderbook analysis)

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• EUR/JPY has established above 147.00 as a hawkish ECB would widen ECB-BOJ policy divergence.
• The ECB may trigger a 75 bps rate hike to fight against mounting price pressures.
• EU may join hands with the UK and Switzerland to put a price cap on energy prices.

The pair currently trades last at 147.013.

The previous day high was 148.4 while the previous day low was 144.1. The daily 38.2% Fib levels comes at 145.75, expected to provide support. Similarly, the daily 61.8% fib level is at 146.76, expected to provide support.

The EUR/JPY pair has reached near the suspected Bank of Japan (BOJ) intervention level at around 147.26 in the early Asian session. The asset is oscillating in an extremely lower range above 147.00, making it a critical make or a make situation ahead. As the cross has recovered the entire gyration to near 144.00, the shared currency bulls look curious for further adventure to near a seven-year high at 148.40.

The Japanese officials have denied unveiling clear information on interventions, therefore, the knee-jerk reactions are considered intervention areas by the Bank of Japan (BOJ). As per the statement from Japanese officials, the BOJ is intervening to safeguard the Japanese yen against disorderly FX moves. Market veterans believe that the intervention moves are mere short-lived attempts of safeguarding yen. And, a hawkish policy seldom could support Tokyo.

This week, the interest rate decision by the BOJ will hog the limelight. As external demand shocks are impacting the economic prospects of Tokyo, BOJ Governor Haruhiko Kuroda may follow the current ultra-dovish stance. More helicopter money will be infused to spurt the growth rate and the overall demand.

On the Eurozone front, investors are awaiting the announcement of the monetary policy by the European Central Bank (ECB). Considering the mounting price pressures, ECB President Christine Lagarde will announce a bigger rate hike. According to analysts from Rabobank, a 75 basis point (bps) interest rate hike is a done deal. They see the deposit rate reaching 3% by March next year.

In the fight against accelerating energy prices, the EU may join hands with the UK and Switzerland. The EU is planning a price cap on energy prices to delight households against soaring energy bills. The strategy is to be executed without boosting demand or delivery of electricity to foreign consumers at subsidized prices.

In response to that, the Trading bloc’s executive arm is advising EU members that such a price limit would have to be extended to power-importing countries like the UK or Switzerland for it to be effective, reported Bloomberg.

Technical Levels: Supports and Resistances

EURJPY currently trading at 147.2 at the time of writing. Pair opened at 145.91 and is trading with a change of 0.88 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 143.11, 50 SMA 141.28, 100 SMA @ 140.51 and 200 SMA @ 136.88.

The previous day high was 148.4 while the previous day low was 144.1. The daily 38.2% Fib levels comes at 145.75, expected to provide support. Similarly, the daily 61.8% fib level is at 146.76, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 143.88, 141.84, 139.58
• Pivot resistance is noted at 148.18, 150.44, 152.48

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