EUR/JPY trampolines to 133.97 highs

FXstreet.com (Chicago) - EUR/JPY advanced to 2-day highs on Japanese corporate tax cut possibility and $1.16 trillion national pension fund rebalancing. The pair has gained 0.49% so far.

Price action reveals heavy buying on the yen’s weakening after governmental announces to hike tax sales and potentially cut corporate taxes. Moreover, the Japanese pension re-balancing triggered strong market reactions across the board. The Nikkei went from 1.20% losses to 0.34% gains on public announcements.

EUR/JPY Technical Levels

Technically speaking, the pair continues on upward trendline since last July 20th with primary, secondary and short-term trends pointing up. Offered at 133.81, the pair maintains 4-year highs and oscillates between supports aligned at 133.33 (September 10th highs), 132.91 (September 25th lows) followed by 132.61 (September 24th lows) and the resistances set at 133.80 (September 23rd highs), 134.28 (September 20th lows) ahead of 134.73 (September 20th highs). According to the FXstreet.com trend index, the pair is strongly bearish on one-hour timeframe analysis with a neutral EMA20.

Yen moves go viral, Japan's pension fund re-balancing weighs

What it started as a tepid headline by Kyodo that Japanese authorities are considering to cut corporate tax rate - nothing new - has turned into a self-fulfilling prophecy to buy the screen on the Nikkei and all Yen crosses.
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GBP/JPY propelled to 159.27 highs

GBP/JPY was fueled by the market participants reactions to the Japanese pension fund re-balancing. Reaching the 159 zone momentarily, the pair failed to sustain impulsive reaction and retraces to the 158.90 zone.
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