EUR/JPY firmer above 126.00 supported by risk appetite

The cross keeps the bid tone intact beyond the 126.00 handle.
Positive Chinese data sustains the risk-on mood.
EMU final CPI came in as expected in March.

Pablo Piovano FXStreet

The persistent buying interest in the risk-associated complex continues to bolster the up move in EUR/JPY to levels closer to the 127.00 handle.

EUR/JPY tests the 200-week SMA around 126.80

The cross has left behind yesterday’s pullback and has now shifted its focus to the upper end of the range, meeting resistance at the 200-week SMA in the 126.80 region and ahead of the critical 127.00 the figure.

Auspicious data releases in the Chinese docket during early trade have been propping up the renewed mood in the riskier assets in detriment of the demand for the safe haven JPY, in turn lifting the cross to higher ground.

Earlier in the session, final inflation figures in the euro area matched the preliminary readings, leaving no room for surprises among investors.

Later in the day, Fed speakers and the publication of the Fed’s Beige Book should set the tone around the buck and collaborate with the price action in the risk complex.

EUR/JPY relevant levels

At the moment the cross is gaining 0.26% at 126.64 and faces the next hurdle at 126.80 (high Apr.17) seconded by 127.50 (2019 high Mar.1) and finally 127.64 (200-day SMA). On the other hand, a breach of 126.19 (low Apr.16) would expose 125.46 (55-day SMA) and then 123.65 (low Mar.28).

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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