EUR/JPY spike closer to 122.00 handle after upbeat EZ CPI

Haresh Menghani FXStreet

Having dropped closer to 100-day SMA support, the EUR/JPY caught fresh bids and extended its up-ward trajectory to fresh session tops beyond mid-121.00s after Euro-zone inflation data.

According to the flash estimates, released just a while ago, the composite Euro-zone headline inflation, as measured by CPI, is expected to have risen by 1.9% y-o-y during April, while core CPI is seen rise to 1.2% during the same period, sharply up from 1.5 and 0.7% rise reported in the previous month.

The readings surpassed consensus estimates eased concerns raised by the ECB President Mario Draghi, during the post meeting press conference on Thursday, and triggered a fresh wave of optimism surrounding the shared currency.

• ECB Review: Subtle shifts in tone - Nomura

Meanwhile, an offered tone surrounding the Japanese Yen further collaborated to the pair's up-move back closer to over 1-month highs touched on Wednesday, in the aftermath of Emmanuel Macron’s victory in the first round of the French Presidential election.

Technical levels to watch

Immediate resistance on the upside is seen near the 122.00 handle and any further up-move beyond the said handle now seems to confront strong resistance near 122.20-25 region. On the flip side, weakness below 120.65-60 immediate support (100-day SMA) is likely to accelerate the slide towards the key 120.00 psychological mark.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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