EUR/JPY upside fails near 123.50 ahead of US ISM
- EUR/JPY retakes the 123.00 handle and above.
- JPY-selling accelerated after US-China truce.
- US ISM manufacturing next of relevance in the docket.
The renewed offered bias around the Japanese safe haven is bolstering the up move in EUR/JPY to fresh 2-month tops in the 123.35/40 band, where if found strong resistance.
EUR/JPY up on trade news, looks to data
The recently clinched trade truce between the US and China has given extra motivation to JPY-sellers to return to the markets, favouring the upside in the cross to levels well above 123.00 the figure.
In fact, yields of the US 10-year note moved higher in the wake of the positive developments from the trade front, while the auspicious meeting between President Trump and North Korea’s Kim Jong-un have also lent support to the risk-associated universe, all rendering in extra outflows from the safe haven JPY.
Earlier in the session, German labour markets figures came in on the soft side, while the final manufacturing PMI dropped further to 45.0 during last month, showing any recovery in the economy remains absent for the time being. In the broader Euroland, manufacturing PMI also disappointed expectations, dropping to 47.6. On the brighter side, the jobless rate ticked lower to 7.5% during May.
Later in the day, Markit will publish its final manufacturing PMI followed by the critical US ISM manufacturing for the month of June.
EUR/JPY relevant levels
At the moment the cross is gaining 0.23% at 122.93 and faces the next hurdle at 123.35 (high Jul.1) followed by 123.75 (high May 21) and then 124.20 (100-day SMA). On the other hand, a breakdown of 122.09 (21-day SMA) would expose 120.95 (low Jun.21) would expose 121.65 (low Jun.25) and then 120.95 (low Jun.21).
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.
