EUR/JPY consolidates gains, still above 119

Eren Sengezer FXStreet

The EUR/JPY pair extended its correction slide below 119 handle during the NA session but didn't spend much time there as it was able to find support at 118.90. As of writing, the pair was trading at 119.20, up 1.9% on the day.

The pair started the day with a 370-pips bullish gap as Macron came on top in the first round of French presidential election, easing the concerns over the possibility of the anti-EU candidate Le Pen becoming the next president of France.

Elabe Poll: Macron 64% vs. Le Pen 36%

The euro gained strength against its competitors and at the same time, increasing risk appetite throughout the day continued to hurt the safer JPY. The Euro Index leaped to its highest level since march 12 at 88.35 before retracing back below the 88 mark. After the strong rally witnessed in the European stock indexes, the American stocks also had a strong start to the day, further limiting the possibility of a JPY correction. At the time of writing, both the Dow Jones Industrial Average and the S&P 500 were up more than 1% on the day.

European stocks rally led by CAC 40

Technical outlook

The pair is facing the initial resistance at 120 (psychological level) ahead of 120.70 (daily high) and 121.15 (Mar. 19 high). To the downside, supports could be seen at 119/118.90 (psychological level/daily low), 118.55 (Mar. 31 high) and 118 (Apr. 3 low/psychological level).

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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