Eurozone Inflation Slips, another Headwind for EUR/JPY

The single currency euro got another hit after delivering worse than expected in the CPI figures. Inflation unexpectedly slid in April as prices of services rose at a moderate pace, raising questions about the European Central Bank’s policy for a gradual removal of a monetary stimulus.

ECB is targeting a 2% inflation rate, but as of Jan 2018, they are consistently deliveringnegative figures. Just today, the inflation of 19 countries fell down to 1.2% vs. the 1.3% previous level. There’s not much movement in the market, but it’s still leaving a question mark regarding the ECB’s effort to meet the 2% inflation target.

EUR/JPY - 2 Hour Chart

EUR/JPY – 2 Hour Chart

Technically speaking, the bearish trendline of the 2 – hour chart is providing solid resistance at 131.600. As per the 50- period EMA, the EUR/JPY is trading on a bearish trend and that’s why we should be looking for bearish trades. The RSI is also holding below 50, supporting the selling bias of investors.

EUR/JPY – Trading Plan

In addition to the fundamentals and technical reasons discussed above, we open a forex trading signal to sell EUR/JPY after a formation of dojicandle below 131.580. The pair is likely to target 131 and 130.850. Good luck!

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
0 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments

HFM

Doo Prime

XM

Best Forex Brokers