EUR/JPY remains bid but off daily highs near 129.40

EUR/JPY climbs to 2-day highs near 129.40 on Monday.
Risk-on sentiment keeps weighing on the dollar.
US Factory Orders comes next in the calendar.

Pablo Piovano FXStreet

EUR/JPY leaves behind the initial pessimism and surpasses the key 129.00 barrier at the beginning of the week.

EUR/JPY bolstered by risk-on mood

EUR/JPY manages to advance past the 129.00 mark at the beginning of the week, staging quite a moderate comeback after bottoming out in the mid-128.00s earlier in the session.

In fact, the prevailing risk-on sentiment favours the selling bias in the Japanese yen and sends the cross higher, although the bull run seems to have run out of steam in the 129.40 zone so far.

Higher US yields in response to the selloff in the fixed income space sponsor the selling momentum in the Japanese yen and the dollar, all rendering in further upside in EUR/JPY.

In the docket, the Sentix index in the euro area eased to 16.9 for the month of October, while US Factory Orders are due later in the NA session.

EUR/JPY relevant levels

So far, the cross is up 0.40% at 129.25 and a surpass of 129.71 (200-day SMA) would expose 130.47 (weekly high Sep.29) and then 130.67 (100-day SMA). On the downside, the next support comes at 128.51 (low Oct.4) followed by 127.93 (monthly low Sep.23) and finally 127.00 (round level).

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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