FxWirePro: EUR/JPY Daily Outlook

Chart - Courtesy Trading View 

Spot Analysis:

EUR/JPY was trading 0.73% higher on the day at 135.92 at around 10:20 GMT

Previous Week's High/ Low: 136.69/ 133.74

Previous Session's High/ Low: 135.79/ 134.58

Fundamental Overview:

The shared currency caught a bid wave after upbeat German IFO data and hawkish Lagarde’s comments.

Data published by Germany's Ifo Institute showed on Monday that the Business Climate Index improved to 93 in May from 91.9 in April, beating market expectation of 91.4.

Further, the Current Assessment Index rose to 99.5 from 97.3 and the Expectations Index edged higher to 86.9 from 86.8.

ECB President Christine Lagarde in her speech earlier on Monday said that the central bank is in a position to exit negative rates by end of Q3.

Technical Analysis:

- EUR/JPY finds strong support at 110-EMA and daily cloud, weakness only on break below

- Price action has broken above 200H MA and 21-EMA

- Stochs and RSI are biased higher, RSI has edged above 50 mark

- 5-week MA is capping upside and is biased lower, upside pauses at 20-DMA

- GMMA indicator shows major and minor trend are neutral on the daily charts

Major Support and Resistance Levels:

Support - 134.80 (55-EMA), Resistance - 136.05 (20-DMA)

Summary: EUR/JPY finds strong support at 110-EMA and daily cloud, weakness only on break below. On the other side, decisive breakout above 20-DMA will push the pair higher.