EUR/JPY clings to gains around 133.40
- EUR/JPY’s upside run out of steam near 133.70.
- German final May CPI rose 0.5% MoM and 2.5% YoY.
- US Retail Sales contracted more than expected in May.
The mild upward pressure in the greenback keeps the sentiment for the European currency somewhat depressed and forced EUR/JPY to recede from earlier tops near 133.70.
EUR/JPY keeps targeting the 2021 highs beyond 134.00
EUR/JPY looks to add to Monday’s moderate advance well above 133.00 the figure, although the imminence of the FOMC event motivates investors to stick to the cautious tone.
In the meantime, yields on both sides of the Atlantic appear to have regaining some shine amidst the broad-based consolidative mood in the global markets.
Markets participants continue to adjust to the recent higher-than-expected US consumer prices, although the Fed’s view that current higher inflation is temporary appears to be gaining traction and could undermine occasional buts of strength in the dollar.
Earlier in the euro docket, the German fina CPI rose 0.5% inter-month and 2.5% on a year to May.
In the more relevant US calendar, Retail Sales surprised to the downside in May after contracting 1.3% MoM in the headline version. Further data saw the Empire State index at 17.4 (from 24.3), Producer Prices gaining 0.8% MoM during last month, Industrial Production expanding 0.8% MoM in the same period and Capacity Utilization improving to 75.2% (from 74.6%).
EUR/JPY relevant levels
So far, the cross is gaining 0.05% at 133.45 and a surpass of 134.12 (2021 high Jun.1) would pave the way for a test of 134.40 (monthly high Sep.2017) and then 134.50 (monthly high Oct.2017). On the other hand, the next support is located at 132.64 (monthly low Jun.14) followed by 132.52 (weekly low May 24) and finally 131.64 (weekly low May 12).
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.
