• The euro has gone back and forth during the course of the trading session on Tuesday against the Japanese yen, as we are hanging around the 50 day EMA and the 200 day EMA indicators.
• At this point in time, if the market were to take off to the upside, we could see a fairly big move, maybe as high as the 165 yen level.
• You also have to keep in mind that the European Central Bank has a significant interest rate decision, meeting and press conference on Wednesday that will throw some chaos into this.

Sideways Action to Continue?

That being said, I think you are seeing an overall sideways action in this EUR/JPY pair, like you are a lot of pairs that are dealing with the Japanese yen right now. I think you, as traders, are probably more likely than not going to see plenty of opportunities of buying the dip because I think it's probably only a matter of time before we break higher. But we'll have to wait and see.

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This pair is going to be a little bit different than some others because although the Japanese yen itself is rather weak, you also have to keep in mind that the ECB could be extraordinarily dovish. So, it's a bit of a push and pull as to whether or not people are focusing on the Euro or the Yen in this pair because the Yen, I expect to be weak, especially against the dollar. And that could be felt in this pair as well.

Ultimately, if we can break above the 165 Yen level, then we could go looking at the 167 Yen level. A breakdown below the 160 yen level then really brings in a lot of value hunting probably closer to the 158 yen level, but right now I think it's more short-term sideways chop that you are looking at.

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