Usd/jpy Price Analysis: Extends Pullback From 10-dma Towards 129.00
2022, 18 May - Forex
Last Week, Eurusd Surged By Almost 1 Percent Touching The Higher Levels Of 1.1909 As The Us Dollar Index Slumped
Brief:
Last week, EURUSD and EURINR surged by almost 1 percent touching the higher levels of 1.1909 and 88.62 respectively as the US Dollar Index slumped after the US 10-year debt touched a record low, which for some reflects concerns over the spread of the delta coronavirus variant and a possible peak in the economic recovery from the pandemic.
Moreover, business activity in the Euro-zone shot ahead at its fastest rate in 21 years in July as the economy went into full throttle with loosened COVID-19 restrictions. In addition, the Fed Chairman Jerome Powell said the U.S. central bank is nowhere near considering a rate hike despite the optimism over the U.S. economy. This weakened the DXY in turn supporting the shared currency. On the last trading day, the German inflation data unexpectedly jumped to 3.8% YoY in July. This was the first time since August 2008 that the annual inflation rate in Europe's largest economy rose to above 3%. The European Central Bank recently raised its inflation target to 2% and said it would tolerate temporary over or undershooting of the target before stepping in.
So far, on friday spot is down 0.05% at 1.1879 and a breakdown of 1.1751 (monthly low Jul.21) would target 1.1704 (2021 low Mar.31) en route to 1.1602 (November 2020 low). On the upside, the next hurdle is located at 1.1908 (weekly high Jul.30) followed by 1.1975 (weekly high Jun.25) and finally 1.2004 (200-day SMA).
Suggestion:
Buy above 1.1605 for 1.2350 and 1.2550
Else
Sell below 1.1605 for 1.1170 and 1.0725
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