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Yen Hits 5-year Low against Euro

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Yen Hits 5-year Low against Euro

The Euro continued to climb higher on Thursday against the yen as better than expected EU data hit the tape on Thursday. EU consumer confidence was stronger than expected while German unemployment notched up its 4th consecutive monthly gain.

Eurozone’s consumer confidence data for November came in right at expectations of -15.4. Economic confidence rose to 98.5, slightly higher than the 98.0 expected, while the services and industrial indicators beat estimates at -0.8 and -3.9, respectively. On the money supply side, which reflects the velocity of money and therefore inflation, M3 in the euro-area expanded by 1.4% year over year in October, less than the 1.7% forecast.

German unemployment data for November showed a fourth consecutive monthly increase. Unemployment increased by 10K to nearly 3 million, though the rate remains at 6.9%. Import prices were lower than expected, at -0.7% month over month compared to expectations of -0.3%.

The EURJPY continue to rise a and will not hit resistance until 145.00. Short term support on the currency pair is seen near the 10-day moving average at 136.67.

Momentum on the EURJPY is positive as the MACD (moving average convergence divergence) index generated a buy signal. This occurs when the spread (the 12-day moving average minus the 26-day moving average) crosses above the 9-day moving average of the spread. The index moved from negative to positive territory confirming the buy signal.

The RSI (relative strength index) which is an oscillator that measures overbought and oversold levels by generating an index between 1-100 is printing near 71 which is in overbought territory. Levels below 30 on the RSI are considered oversold and levels above 70 are considered overbought.

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