EUR/JPY recedes from new 2021 highs around 131.00

EUR/JPY loses the grip post-YTD peaks near 131.00.
The rebound in the dollar removes strength from the uptick.
German Producer Prices surprised to the upside in March.

Pablo Piovano FXStreet

The greenback now recovers some ground lost earlier in the session and prompts a mild knee-jerk in the single currency, at the same time motivating EUR/JPY to recede from earlier new YTD peaks just below 131.00 the figure.

EUR/JPY deflates from YTD highs

After recording new yearly tops in the proximity of the 131.00 barrier, EUR/JPY gave away part of that move, although it manages to keep the bid bias well in place for the time being.

The favourable context for the risk complex put the buck under extra pressure during early trade, dragging the US Dollar Index (DXY) to new multi-week lows in sub-91.00 levels.

The rebound in US yields from Monday’s lows also lends some wings to JPY-sellers, therefore collaborating with the bullish move in the cross.

Data wise in Euroland, German Producer Prices came in above estimates in March, gaining 0.9% inter-month and 3.7% from a year earlier.

EUR/JPY relevant levels

At the moment the cross is up 0.20% at 130.42 and a move past 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 other hand, the next support at 129.57 (low Apr.8) followed by 129.21 (50-day SMA) and finally 128.29 (weekly low Mar.24).

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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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