EUR/JPY bounces off lows, approaching 121.00

EUR/JPY met support near 120.80 on Friday.
EUR-selling keeps weighing on the cross.
German, EMU flash PMIs came in above expectations.

Pablo Piovano FXStreet

The persistent selling momentum in the European currency has been putting EUR/JPY under excessive downside pressure in the past couple of sessions.

EUR/JPY tested and rebounded from the 200-day SMA

The cross is losing ground for the second session in a row on Friday, coming under heavy selling pressure on the back of the negative performance of the single currency, exacerbated after Thursday’s ECB meeting.

However, the weekly pullback in the cross appears to have met solid contention in the 200-day SMA around 120.80 for the time being, as the continuation of the offered mood in the Japanese safe haven has tempered the retracement somewhat, always sustained by the better mood in the risk complex.

In the data pace, EUR has practically ignored the auspicious results from advanced Manufacturing PMIs in both Germany and the broader Euroland for the current month, adding to the idea that the region could have left the worst behind, particularly the key manufacturing sector.

EUR/JPY relevant levels

At the moment the cross is losing 0.06% at 120.96 and a breach of 120.81 (200-day SMA) would aim for 120.63 (weekly lows Jan.23) and finally 120.16 (2020 low Jan.3). On the other hand, the initial up barrier is located at 121.74 (21-day SMA) seconded by 122.00 (10-day SMA) and then 122.87 (2020 high Jan.16).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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