EUR/JPY extends its decline

Source: Dukascopy Bank SA
© Dukascopy Bank SA
"The optimistic tone of recent BOJ communication suggests that the chances of additional stimulus being announced as soon as July have shrunk substantially, but we still think that more easing will eventually be required."
- Capital Economics (based on Bloomberg)


Pair's Outlook
Currently the weak Euro has prolonged its depreciation against the well-performing Japanese Yen by falling below the weekly S1 and monthly S2 at 138.30/38. In the short term we expect the shared currency to extended its decline towards the weekly S2 at 137.46. At the same time we dot see the pair approaching this year low at 136.22. The monthly technical indicators are largely bullish; therefore, in a long run we could see the pair rebounding.

Traders' Sentiment

Even though the gap between the bullish and bearish market participants widened, it still remains rather small. At the moment there are 56% bullish and 44% bearish traders. In the meantime, the share of buy orders grew from 51% up to 66%.
© Dukascopy Bank SA

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