• EUR/JPY is looking to scale above 141.00 as the ECB is preparing for more hikes.
• ECB Schnabel cited that headline inflation has begun to decline although said core inflation remains sticky.
• The speech from BoJ Ueda will provide guidance about the likely monetary policy action.

The EUR/JPY pair is facing barricades around 141.00 in the Tokyo session. The cross is struggling in extending its recovery above the aforementioned resistance, however, the upside seems favored as the European Central Bank (ECB) is preparing more rate hikes ahead.

Isabel Schnabel, Member of the ECB's Executive Board, has said headline inflation has begun to decline although said core inflation remains sticky. The ECB would be needed immense strength to bring higher inflation down to the desired levels, therefore, more rate hikes cannot be ruled out.

On the Japanese Yen front, the speech from Bank of Japan (BoJ) Governor Kazuo Ueda, scheduled for Tuesday, will be of significant importance. This will provide guidance about the likely monetary policy action.

EUR/JPY has rebounded firmly from the horizontal support of the Bearish Megaphone chart pattern formed on a two-hour scale. The horizontal support of the chart pattern is plotted from March 16 low at 139.13 while the upward-sloping trendline is placed at 141.58. Usually, a bearish megaphone pattern results in sheer weakness after the breakdown of critical support.

The 50-period Exponential Moving Average (EMA) at 141.00 is acting as resistance for the Eurozone bulls.

Meanwhile, the Relative Strength Index (RSI) (14) has shifted into the 40.00-60.00 range from the bearish range of 20.00-40.00, which indicates a reversal for the time being.

Should the asset breaks above March 21 high at 142.79, Euro bulls would drive the cross toward March 09 low around 144.00 followed by March 15 high at 145.00.

On the flip side, a downside break below March 16 low at 139.13 would drag the cross toward January 19 low at 138.00. A slippage below the same would expose the asset to a 26 September 2022 low of around 137.36.

EUR/JPY hourly chart