EURJPY is currently showing signs of bullish momentum, with the bulls on the verge of testing the recent high of 165.34. Despite this, there is a looming threat of intervention which is limiting the aggressive bullish appetite in the market. The ongoing verbal commentary from Japanese officials and the upcoming BoJ meeting, coupled with dovish statements from ECB members, are contributing to the uncertainty and volatility in the market.
While momentum indicators are showing a degree of bullish tendency, there are mixed signals to consider. The RSI is hovering above its midpoint, indicating some bullish sentiment. Additionally, the stochastic oscillator is attempting to move back into the overbought territory. However, the Average Directional Movement Index (ADX) remains below the 25-threshold, signaling a lack of strong trend in the market. This suggests that the market may be range-bound in the near term.
If the bulls manage to ignore the intervention threat, their next target would be to break above the 165.34 high and aim for the July 13, 2007 high at 168.93. On the other hand, the bears are looking to push the price below the support level of 164.29-164.97 and test the simple moving averages at 163.19 and 160.93. If successful, they could target the range of 159.64-159.80 for further downward movement.
The EURJPY market is currently at a critical juncture, with both bulls and bears vying for control. The intervention threat and upcoming central bank meetings are adding to the uncertainty and potential for volatile swings. Traders should keep a close eye on key levels and technical indicators to assess the direction of the market in the coming sessions.