The EUR/JPY cross has attracted some buyers on Thursday, staging a modest bounce from the four-week low touched earlier in the day. Currently trading around the 159.20-159.25 area, the currency pair has shown some resilience after a recent retracement slide.
The recent weakness in the Japanese Yen (JPY) has provided some support to the EUR/JPY cross, but caution is advised due to divergent policy expectations between the Bank of Japan (BOJ) and the European Central Bank (ECB). While the market is anticipating a possible rate hike by the BOJ, the ECB is expected to cut interest rates in September.
Market sentiment also plays a role, as the safe-haven appeal of the JPY could limit the upside for the EUR/JPY pair. It is advisable to wait for strong buying momentum before considering a bullish position in the near term.
In conclusion, the EUR/JPY price action is influenced by central bank policies, economic data, and market sentiment. Traders should monitor these factors closely to make informed decisions and manage their risk effectively in the forex market.
