- EUR/JPY is fading part of the recent up move to the 120.00 area.
- EUR trades on a volatile fashion, JPY remains bid.
- EMU Industrial Production came in on the soft side.
The buying interest around the Japanese safe haven is forcing EUR/JPY to recede further ground and abandon the area of recent tops in the 120.00 neighbourhood.
EUR/JPY met resistance around the 100-day SMA
The cross came under some selling pressure after challenging 2-month tops in the 120.00 region on Friday, where sellers appear to be clustered. This area of resistance is also reinforced by the proximity of the 100-day SMA at 119.83.
The recent sharp rebound in the cross was sustained by the change of heart around the riskier assets after the US and China reached some sort of partial trade deal at the recent negotiations in Washington. The better tone in the risk-complex fuelled the selling bias in JPY, which in turn morphed into extra legs for the cross.
In the meantime, EUR keeps trading within a volatile range so far today amidst some improvement in the sentiment around the buck and following another disappointing figures from the Industrial Production in Euroland, where any hint of a recovery, let alone ‘green dots’, remains largely absent.
EUR/JPY relevant levels
At the moment the cross is losing 0.28% at 119.32 and a breach of 118.28 (55-day SMA) would expose 117.07 (monthly low Oct.3/7) and then 116.56 (low Aug.26). On the upside, the next barrier aligns at 119.83 (100-day SMA) seconded by 120.01 (monthly high Sep.13) and finally 122.34 (200-day SMA).
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