Currently, EUR/JPY is trading at 121.51, up 1.87% on the day, having posted a daily high at 121.68 and low at 119.06.
EUR/JPY has extended the upside since the French election demand took the cross from 116.80 area to space over 120.40 on a bullish opening gap to start the week. The cross has continued to aforementioned highs today after breaking 120.40 with both EUR/USD and USD/JPY better bid along with risk-on sentiment on Wall street taking stocks higher still. Barriers have been broken across the related intermarket assets, indices and financial instruments to fuel the bull's appetites ahead of the ECB this week.
- IFOP Fiducial poll: Macron seen beating Le Pen in 2nd round of French election - Reuters
- EUR/USD: awaits a dovish ECB - Scotiabank
The ECB is expected to be a dovish outcome, but it will be interesting to see if there are any tweaks to policy language now that Macron is expected to win the final round of the French presidential elections - all eyes will be in June and thereafter on such an outcome. Meanwhile, for Japan, eyes are n the BoJ presser and inflation data later on in the week.
EUR/JPY levels
EUR/JPY targets the 121.80 resistance and 20 March highs ahead of the 16th March 122.24 highs. 122.80/00 would put the cross in position for a test of the 2016 Dec highs of 124.08. Longer term outlook is neutral to negative according to analysts at Commerzbank, "The erosion of the 117.50/35 the 2016-2017 uptrend is negative and we look for losses to its 112.53 5 year support line which is expected to hold and provoke a reversal."
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