Global macro overview for 03/03/2017:
The National Consumer Price Index (CPI) is the key gauge of inflation in Japan. The latest set of CPI data has been released overnight. The figures were in line with market expectations (0.4% versus 0.4% expected, 0.3% prior). The inflation rate accelerated for the first time this year (after a year of a negative growth). National CPI has been in positive territory since October when it recorded its first increase in nine months. Inflation is gradually improving on the back of the record monetary stimulus from the Bank of Japan (BOJ). The latest inflation report may be a sign that the highly accommodative BOJ policies began to stimulate price growth in the world's third-largest economy.
Let's now take a look at the EUR/JPY technical picture on the H1 time frame. The market is oversold, and further rally is possible in case the technical resistance at the level of 120.48 is clearly violated. The intraday support at the level of 119.56 should hold the line while the price will be climbing higher. This bullish bias will be invalidated if the market breaks below the intraday support at 119.56.
