- EUR/JPY bounces off 4-day lows near 118.30.
- JPY-buying remains in place so far today.
- EUR reverses initial pessimism.
The now bid tone around the Japanese currency is limiting the recovery in EUR/JPY to the 118.60 region.
EUR/JPY keeps the attention on trade concerns
The cross is navigating its third day with losses so far today, coming under renewed selling pressure after Tuesday’s tops in the vicinity of the key 120.00 the figure.
Unabated demand for the safe haven JPY in response to the prevailing ‘flight-to-safety’ mood in the global markets has been keeping the cross under almost permanent downside pressure.
In addition, political jitters in Italy have resurfaced and speculations over the probability of snap elections have been quickly gathering pace in the past hours.
In today’s docket, Japanese preliminary Q2 GDP figures noted the economy is expected to grow 0.4% QoQ and 1.8% on a yearly basis, both prints coming in above estimates. Closer to home, German trade surplus shrunk to €16.8 billion during June.
EUR/JPY relevant levels
At the moment the cross is losing 0.11% at 118.45 and a breakdown of 117.67 (2019 low Aug.5) would open the door to 114.85 (2017 low Apr.17) and finally 113.71 (monthly low Nov.9 2016). On the upside, the next hurdle is located at 119.87 (high Aug.6) followed by 120.26 (21-day SMA) and then 121.38 (high Jul.30).
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