Forex: EUR/JPY closes slightly higher, support at 127.00 continues to hold

FXstreet.com (Barcelona) - The EUR/JPY closed the day up 12 pips at 128.21, as buyers once again stepped into take advantage of early weakness just above the 127.00 support level. The upcoming European session will be light in regards to economic releases with the European markets closed for holiday. Volatility will no doubt pick up later in the week as we head into the European Central Bank monetary policy meeting on May 2nd at 11:45 GMT.

According to Val Bednarik of FXStreet.com, “The EUR/JPY trades back above 128.00, although finding resistance in the hourly 100 SMA around 128.50 that heads south below 200 one, while indicators remain flat in neutral territory, all of which maintains the pressure to the downside in the pair, despite latest EUR recovery. In the 4 hours chart technical readings remain below their midlines, supporting the shorter term view. So far the pair has found buyers around 127.00 yet if the level gives up, it can shed another 100 pips, as there’s not much in the middle up to 126.00 area. Steady gains above 128.80 on the other hand, will deny the bearish bias and favor a recovery back towards the 130.00 price zone.”

The FXStreet.com remains in Slightly Bullish set up on the daily chart, while the OB/OS again remains at Neutral. From a pattern perspective, the pair continues to form what looks like a continuation “pennant pattern” which will most likely be resolved in coming sessions as the ECB meetings near. Market participants should continue to focus on the upper boundary (129.90) and lower boundary (127.00) for hints at direction of the next major move.