EUR/JPY corrects from critical resistance around 144.00 after ECB meeting
- Euro under pressure following the ECB meeting and Lagarde’s press conference.
- Japanese yen recovers some ground after days with significant losses.
- EUR/JPY again unable to hold above 144.00.
The rally of the EUR/JPY cross hit a strong resistance area around 144.25 and pulled back following the European Central Bank meeting. It recently hit a fresh daily low 143.15. The decline takes place after a 500-pip rally in three days.
Euro softens after ECB
On Thursday, the European Central Bank raised interest rates by 75 basis points as expected, to curb inflation and despite economic grow concerns in the Eurozone. The central bank said it will hike further rates. Lagarde said the next hike is not necessarily a 75 bps.
The euro weakened across the board following the press conference favoring the correction in EUR/JPY. The decline also took place amid a recovery of the yen. USD/JPY pulled back from multi-decades highs to 143.50. Higher US yield still keep the yen under pressure.
The 144.20/30 area again
Like what happened several times in June, the 144.20/30 capped the upside in EUR/JPY. The cross hit on Thursday at 144.32 the highest intraday level since January 2015 but it quickly pulled back.
The euro was unable to hold above 144.00 and lost momentum. The cross needs a consolidation above that area to open the doors to more gains over the medium term. On the flip side, below 143.00, the next support is seen at the 142.40 area (July highs).
Technical levels