EURJPY Lower
Trying EURJPY lower here.
Nice shooting star on the daily chart right at resistance - this being the price just before the hawkish BoJ meeting in December, also a potential double top forming here as well.
In terms of fundamentals i think we see a move lower here. I am expecting that global inflation starts to come off soon which should mean lower yields and a stronger JPY. Seeing as most central banks are getting close to their peak rates as well yields should have limited room to the upside. JPY should also benefit as we get closer to the next BoJ meeting in the next couple weeks as we could see JPY strengthen as people position for a potential hawkish BoJ.
rate differentials are near the lows which EURJPY has been following this year, inflation expectations are a tough to the downside as well. JPY seasonal weakness has ended and that has been a large reason for the JPY weakness recently.
EUR positioning is pretty extreme on the long side, not too helpful but could mean limited upside for the EUR.
overall more of a JPY strength trade but also offers a decent risk/reward with resistance to the topside.
Not trading/investment advise, feedback welcome!
Nice shooting star on the daily chart right at resistance - this being the price just before the hawkish BoJ meeting in December, also a potential double top forming here as well.
In terms of fundamentals i think we see a move lower here. I am expecting that global inflation starts to come off soon which should mean lower yields and a stronger JPY. Seeing as most central banks are getting close to their peak rates as well yields should have limited room to the upside. JPY should also benefit as we get closer to the next BoJ meeting in the next couple weeks as we could see JPY strengthen as people position for a potential hawkish BoJ.
rate differentials are near the lows which EURJPY has been following this year, inflation expectations are a tough to the downside as well. JPY seasonal weakness has ended and that has been a large reason for the JPY weakness recently.
EUR positioning is pretty extreme on the long side, not too helpful but could mean limited upside for the EUR.
overall more of a JPY strength trade but also offers a decent risk/reward with resistance to the topside.
Not trading/investment advise, feedback welcome!
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