The EUR/JPY pair is trading in the green at 158.60 at the time of writing. The outlook remains bullish, so further growth is natural. After its strong growth, a retreat was expected as the rate needs to accumulate more bullish energy before jumping higher.
Fundamentally, the German WPI came in worse than expected. Tomorrow, Japan is expected to release the Revised Industrial Production, Prelim GDP, and Prelim GDP Price Index. On the other hand, the German ZEW Economic Sentiment is expected at -15.0 points, while ZEW Economic Sentiment could remain deep in the negative territory at -12.0 points.
EUR/JPY Bullish Bias!
You knew from previous analysis that the EUR/JPY pair could resume its upwards movement after taking out the 158.04 resistance.
Now, it has dropped a little, developing a flag pattern which should announce an upside continuation.
EUR/JPY Outlook!
As long as it stays above 158.04, EUR/JPY could resume its growth. Jumping and closing above 158.80 and above the flag's resistance activates further growth. This is seen as a buying signal. The R1 (159.92) represents a potential target.
