The price chart of the EUR/JPY currency pair shows an interesting price reaction in this one important zone which is the support zone for the price.
The zone in question is around 138.00 which saw several times a strong bounce in the price when it touched the zone.
Wednesday saw drastic daily price movements due to the market's reaction to the results of the Japanese central bank meeting.
The Bank of Japan (BOJ) decided to maintain loose monetary policy, missing expectations for changes with interest rates also remaining at -0.10%.
This has led to a significant decline in the Yen currency, but managed to trade stable back to the level before the surge in value.
It can be observed that the price has jumped from the 138.00 zone to reach a height of 141.600 last Wednesday, but then fell back to the 138.00 support zone continuing on Thursday trading yesterday.
Once again the zone 'rejected' the price displayed a rebound and continued trading in the Asian session this morning (Friday), the price has crossed the Moving Average 50 (MA50) barrier level on the 1-hour time frame for a bullish signal.
The upswing continued into the European session testing around the 140.00 level with expectations of a further move higher in the New York session to close out the week's trading.
However, will the price be able to reach the height again last Wednesday?
If it succeeds in overcoming it, the price will continue the bullish trend towards the resistance zone at 143.00.
On the other hand, if the price plunges again, the important zone of 138.00 will be tested again and the price reaction in that zone will be observed whether it is able to rebound the price upwards.
If it fails, the price that penetrates lower is seen to enter the concentration zone between 137.500 to 136.600.
