EUR/JPY PRICE FORECAST: BULLISH OUTLOOK SEEMS VULNERABLE AROUND THE 100-DAY EMA NEAR 161.00
EUR/JPY PRICE FORECAST: BULLISH OUTLOOK SEEMS VULNERABLE AROUND THE 100-DAY EMA NEAR 161.00
The EUR/JPY cross has weakened to approximately 161.05 during the early European session on Thursday.
This decline is attributed to the Japanese Yen (JPY) strengthening against the Euro (EUR), influenced by Japan's higher-than-expected Producer Price Index (PPI).
Japan's annual PPI rose to 4.2% in March, up from 4.1% in February, surpassing market forecasts of a 3.9% increase.
This persistent inflation suggests ongoing cost pressures, influencing expectations for future monetary policy adjustments by the Bank of Japan (BoJ).
The 100-day EMA near the 161.00 level serves as a critical support zone.
The pair's proximity to this EMA suggests a potential test, which could determine the sustainability of the current bullish trend.
The 14-day RSI stands above the midline near 73.35, indicating overbought conditions.
This may limit further upward momentum and increase the likelihood of a corrective pullback.
A sustained break below the 161.00 level, coinciding with the 100-day EMA, could lead to a test of the next support zone around 159.62. Failure to hold above this support may expose lower levels.
