The EUR/JPY cross built on to its recovery momentum further beyond the key 120.00 psychological mark after better-than-expected Euro-zone PMIs.
Currently trading around 120.15 region, the cross caught fresh bids and reversed previous session's losses after the Markit Flash Germany Composite Output Index rose for the second month running from 56.1 in February to 57.0 in March, the highest since May 2011.
According to Markit, Germany posted the fastest rate of private sector output growth in nearly six year during March and signaled marked economic growth in the Euro-zone’s largest economy.
Other details revealed, flash German manufacturing PMI, at 58.3, rising to 71-month highs, while services PMI climbing to 15-month high level of 55.6 and boosted the shared currency across the board.
Meanwhile, the flash version of composite Euro-zone PMI also came in to show the region's growth hitting six-year high and supported the strong bid tone surrounding the cross.
Technical levels to watch
A follow through momentum above 120.30 area (yesterday’s high) is likely to boost the cross back towards 100-day SMA near 120.60 region, above which a fresh bout of short-covering should help it to reclaim the 121.00 handle and head towards testing its next major hurdle near 121.60 region.
On the downside, retracement back below the 120.00 handle now seems to find support near 119.65-60 region, which if broken would turn the pair vulnerable to slip below 119.00 round figure mark and head towards its next major support near 118.40 area.
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