EUR/JPY forecast for January 25, 2021

Looking at the chart on the weekly time frame, we see that the EUR/JPY pair finds resistance at the Fibonacci level of 38.2%. At the same time, the bottom side has strong support for moving averages and almost the MA200, which can be psychological support to buyers to continue the bullish scenario. Below we also have a trend line as support that resists for now, and it makes sense for now. For the bearish scenario, we need a break below the trend line and psychological level 125.00.
We see that the EUR/JPY pair moves in a growing channel with a certain pullback from the top line to the bottom line on the daily time frame. The price is currently below the moving average of MA20 (light blue line), and if we see a pullback, we will see it to the bottom trend line at 125.00. The raw picture is still bullish, and if we don’t see a pullback, we go right up where we need a break above 128.00 to look towards 130.00 in the coming period.
On the four-hour time frame, we see that we have one trend line that makes the support pair continue the bullish trend from the bottom. Following moving averages, we see that the pair now has support for MA20 and MA50 and is currently testing MA200 and MA100. If we see a break above, we can see the EUR/JPY pair again at 127.00 and possible testing of the previous high at 127.50. For the bearish scenario, we need a break below the bottom line of the trend to have confirmation on the chart for something like that.
From today’s news, we can single out the following:
Statement by the Governor of the Bank of Japan Haruhiko Kuroda: that the revival of the virus, a new state of emergency could harm Japan’s economic recovery. That the most important policy is to avoid unemployment and the collapse of companies, and that both fiscal and monetary policies have so far successfully prevented this.
“Climate change could potentially cause a lasting difference between core and core inflation measures and affect household and business inflation expectations,” said European Central Bank (ECB) President Christine Lagarde, speaking at an ILF web conference on “Green Banking and Green Central Banking: What are the real concepts? ”
She said the central bank is now launching a new climate change center” to bring together more diverse expertise and areas of climate work across the bank more efficiently. ”
This afternoon we will again have a statement by President Christine Lagarde, and more statements are expected on the specific monetary policy of the ECB.