EUR/JPY keeps the positive note near 130.00

EUR/JPY manages to reverse the initial drop to 129.60.
Lower US yields weigh on the dollar and pushes the yen higher.
EMU, German flash manufacturing PMIs surprised to the upside.

Pablo Piovano FXStreet

Despite the increasing buying pressure around the Japanese yen, EUR/JPY manages well to keep daily gains near the key 130.00 hurdle so far on Friday.

EUR/JPY bounces off 2-week lows

After bottoming out in new multi-day lows in the 129.60/55 band, EUR/JPY regained some buying interest in response to the strong advance in the single currency, which appears in turn sustained by the moderate sell-off in the greenback.

Indeed, US 10-year yields navigate levels last seen in mid-March around 1.53%, putting the buck under extra downside pressure and sponsoring fresh inflows into the safe haven JPY.

The euro, in the meantime, regains the smile following the steady ECB on Thursday and the auspicious assessment of the economy in the region by the Governing Council.

In the euro docket, flash Manufacturing and Services PMIs for the month of April came in above estimates in France, Germany and the broader Euroland. Across the pond, advanced PMIs are also due along with the March’s New Home Sales.

EUR/JPY relevant levels

At the moment the cross is up 0.11% at 129.84 and a surpass of 130.97 (2021 high Apr.20) would pave the way for a test of 131.00 (psychological level) and then 131.98 (2018 high Jul.17). On the downside, immediate contention is located at 129.37 (50-day SMA) followed by 128.29 (weekly low Mar.24) and finally 127.85 (100-day SMA).

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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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