Forex: EUR/JPY retraces weekly losses, capped at 115.40 (Barcelona) - As risk sentiment grows in the European morning ahead of the ECB monetary policy decision, the EUR/JPY rallied to 115.40 high. However, since the market was able to regress into flat territory on the weekly chart, investors took profits back to the weekly open of 115.23. Last week's upside was topped at 115.99, now viewed as resistance.

Market focus for today is ECB's monetary policy decision and TD Securities analysts suspect the EUR will rise after the event: “The press conference will focus on semantics after the “wide discussion” of a rate cut last month, as well as the modalities of unwinding 3y LTROs, which would leave us with a small bias for rates and EUR higher after the meeting by disappointing the doves”, wrote analyst Alvin Pontoh.

Commerzbank analysts see the EUR/JPY consolidating near term: “While under pinned here (111.43/57) scope will remain for recovery”, wrote analyst Karen Jones. “A close above 116.00 will see the 116.71/50% retracement of the move down from 2009 engage en route to the 117.90 June 2011 high and the 123.33 2011 high itself”, Jones added.