EUR/JPY is trading at 123.62 this Friday morning in Asia; its highest level since January 9.
The currency pair bottomed out at 114.85 (Apr 17 low) and has enjoyed a near 90 degree rally over the last two weeks as polls showed Macron maintaining a significant lead over the anti-EU candidate Marine Le Pen.
Moreover, the ‘hope trade’ was set in motion following Macron's victory in the first round of elections... As predicted by the polls.
European stocks attract $883 million
As per Reuters report, European stock funds continued on their hot streak in the week ended May 3, reeling in $833 million in their biggest haul since March. It is quite clear from the sharp rise in the EUR/JPY that a major part of the fund flow into European stocks has been from the Asian markets.
What it also tells us is that Macron win is priced-in and the markets are dangerously unprepared for Le Pen victory. The near 90 degree rally could be followed by a 90 degree drop if Le Pen comes out victorious. Meanwhile, we could be in for a classic “Buy the rumor, Sell the fact” kind of trade if Macron wins the elections.
EUR/JPY Technical Levels
The cross was last seen trading around 123.60. The daily RSI is overbought, which warrants caution. The first resistance is seen at 123.85 (Dec 30 high) ahead of 124.09 (Dec 15 high) and 124.55 (weekly 100-MA). On the downside, support is seen at 123.00 (zero figure), 122.85 (5-DMA) and 121.84 (10-DMA). Only a daily close below 10-DMA would signal bullish exhaustion.
|TREND INDEX||OB/OS INDEX||VOLATILY INDEX|
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Follow us on Telegram
Stay updated of all the news
EUR/USD holds above 1.0700 supported by Dollar’s slide Premium
EUR/USD is consolidating above 1.0700, supported by a weaker US dollar across the board. The tone around the Greenback changed on Monday after the release of a weak ISM Services PMI report from the US. Despite the rebound from 1.0685 to 1.0720, the pair remains below the 20-day SMA.
AUD/USD holds above 0.6600 ahead of the RBA Premium
AUD/USD rose on Monday ahead of a crucial day for the Aussie with the Reserve Bank of Australia's decision. The central bank is expected to keep rates unchanged at 3.85%, but it's a close call, and a rate hike wouldn't be a major surprise.
Gold grinds higher past $1,950 amid downbeat United States data
Gold stays on the front foot aroud $1,961, after an upbeat start of the week, as the bullion traders seek more clues to extend the latest rebound during early Tuesday in Asia. The precious metal cheered downbeat United States statistics and dicey markets to regain upside momentum the previous day.
Binance and CEO face 13 charges by the SEC, citing securities laws violation
Binance entities and CEO Changpeng Zhao are facing 13 charges from the US SEC. Allegations revolve around securities law violations, among other crimes that the regulator has been clamping down against.
June flashlight for the FOMC blackout period
After raising rates by 500 bps since March 2022, the FOMC signaled at the conclusion of its previous meeting on May 3 that the tightening cycle may be coming to an end.