The price of EURJPY is approaching a key resistance zone, will this area fail or hold?
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The price of EURJPY has moved substantially higher over recent weeks and months due to the sell off in the JPY. This was caused by the Bank of Japan falling to move rates despite rising inflation. The ECB have recently talked of hiking rates this month which could see the EURO strengthen towards the event. The stock markets have been the catalyst for JPY strength, when the volatility in the market increases we have seen a negative effect for stocks and a positive move for the JPY. With stocks making a minor rebound we could see EURJPY reach the key highs.
The monthly chart shows the price falling from around similar prices back in 2014, if the price retests this zone we could see sellers enter the markets again. The weekly chart shows price in an impulsive phase heading back towards the highs, this could be a sticking point for the market. The 4hr chart shows a minor zone at 144.00 where sellers entering the market, if the price forms bearish price action here we could look for short term opportunities to the downside. If the price rallies through the highs we could expect a false breakout and a retest of the monthly zone.
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