EUR/JPY upside faltered above the 123.00 handle

EUR/JPY moves lower from recent tops beyond 123.00.
The firm demand of JPY weighs on the cross.
US CPI figures next of relevance in the docket.

Pablo Piovano FXStreet

The now better mood surrounding the Japanese safe haven is forcing EUR/JPY to lose some traction and refocus on the downside around 122.70.

EUR/JPY focused on risk trends

The cross is alternating gains with losses so far this week, with the upside limited at yesterday’s peaks near 123.20 and the mid-122.00s holding the downside for the time being.

Rising trade concerns have prompted a correction lower in US yields and sparked some risk aversion, morphing into further support for the Japanese currency and adding to the downside momentum in the cross.

Nothing relevant in the euro docket today, while Producer Prices in Japan contracted at a monthly 0.1% during May. Later in the day, US inflation figures measured by the CPI are expected to dictate the sentiment among traders.

EUR/JPY relevant levels

At the moment the cross is losing 0.18% at 122.68 and a breakdown of 122.37 (21-day SMA) would expose 120.78 (low Jun.3) and then 120.54 (monthly low Jan.17 2017). On the upside, the next hurdle aligns at 123.17 (high Jun.11) seconded by 123.75 (high May 21) and finally 123.89 (55-day SMA).

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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