Key Points
- The Euro enjoyed a decent upside move against the Japanese yen recently after trading as low as 112.30.
- There is a short-term bullish trend line formed on the hourly chart of the EURJPY pair, which may act as a support if the pair moves down.
- Earlier today, the Euro Zone Sentix Investor Confidence index was released by the Sentix GmbH.
- The outcome was positive, as there was a rise from 1.7 to 4.2 in August 2016.
Technical Analysis
The Euro managed to gain bids near the 112.30 support area against the Japanese yen and moved higher to trade towards 113.70. The EURJPY pair is currently correcting lower, but may face buyers near a short-term bullish trend line formed on the hourly chart.
Moreover, the 38.2% Fib retracement level of the last leg from the 112.77 low to 113.68 high may also come into play on the downside as a support.
Overall, the pair remains supported on the downside, and may keep rising in the short term.
Euro Zone Sentix Investor Confidence
Earlier today during the London session, Euro Zone Sentix Investor Confidence index, which a monthly survey showing the market opinion about the current economic situation and the expectations for the next semester was released by the Sentix GmbH.
The forecast was slated for a rise from 1.7 to 3 in August 2016. However, the result was positive as there was an increase to 4.2. The report added that “Positive growth impulses of the Chinese economy are accountable for the latest upswing, however. The European economy merely contributes to the confidence built up. The index for Asia ex. Japan jumps from +8.2 to +14.1 points. The latest round of yuan depreciation against the US Dollar and the Japanese Yen seems to act as a stimulant”.
The Euro may gain traction further in the near term, which is why buying can be opted versus the Japanese yen.
