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Introduction to EUR/JPY

The EUR/JPY currency pair reflects the exchange rate between the Euro (EUR) and the Japanese Yen (JPY). This pair is influenced by economic data releases, central bank policies, and geopolitical events, particularly from the Eurozone and Japan. For traders, understanding these factors is crucial to anticipate potential movements in the EUR/JPY exchange rate.

EUR/JPY Market Overview

On May 31, 2024, the EUR/JPY pair is expected to be influenced by several economic data releases. Key among these is the French Final Private Payrolls report, forecasted to show a 0.2% increase. A higher-than-expected result would be positive for the Euro. Other data, such as German Import Prices, German Retail Sales, French Consumer Spending, and various CPI figures, are also on the schedule, though they are expected to have a low impact. On the Japanese side, the Tokyo Core CPI y/y is forecast at 1.9%, indicating mild inflation pressures, which could influence the JPY.

EUR/JPY Technical Analysis

The EUR/JPY pair has been experiencing a gradual bullish trend on the H4 timeframe. The price has recently retraced but remains above critical support levels, suggesting the potential for continued upward movement. The recent price action shows a consolidation phase, with the price moving towards the middle band of the Bollinger Bands.

Key Technical Indicators

– Bollinger Bands: The Bollinger Bands are widening, indicating increased volatility. The EUR/JPY price has been primarily moving between the middle and upper bands, showing bullish momentum. The last few candles suggest a retracement towards the middle band, but the overall direction remains upwards.

– Parabolic SAR: The Parabolic SAR dots are currently positioned below the candles, signaling a bullish trend. The last three dots confirm the bullish stance, supporting the ongoing upward trend.

– MACD (Moving Average Convergence Divergence): The MACD line is slightly above the signal line, with the histogram showing decreasing bearish momentum. This suggests that while the bullish trend may be losing some strength, it is not yet reversing. Traders should watch for a potential bullish crossover, which could reaffirm the uptrend.

– RSI (Relative Strength Index): The RSI is at 46.86, indicating a neutral stance. This suggests there is room for further upward movement before the pair reaches overbought conditions. The RSI supports the current consolidation phase within the broader bullish trend.

Support and Resistance Levels

– Support Levels: Immediate support is at 169.000, aligning with the 61.8% Fibonacci retracement level and recent price action. Further support is found at 167.860, coinciding with the 50% Fibonacci retracement.

– Resistance Levels: Immediate resistance is at 170.825, where recent highs align with the upper Bollinger Band. Further resistance is at 171.415, the recent peak and 100% Fibonacci extension.

Final Words About EUR vs. JPY

The EUR/JPY pair on the H4 chart shows a predominantly bullish trend, supported by technical indicators such as the Bollinger Bands, Parabolic SAR, MACD, and RSI. Although the pair is in a consolidation phase, the overall outlook suggests a continuation of the upward movement. Traders should monitor upcoming economic data releases from the Eurozone and Japan, as they could introduce volatility and influence the pair’s direction. As always, it is essential to stay informed and adjust strategies as market conditions evolve.

Disclaimer: The provided EUR/JPY analysis is for informational purposes only and does not constitute investment advice. Traders should conduct their own research and analysis before making any trading decisions. Market conditions can change rapidly, and it is essential to stay updated with the latest information.