- The cross tumbled to fresh lows near the 128.00 handle.
- Solid JPY demand dragged the cross to fresh 2018 lows.
- Disappointing PMIs in Germany/EMU helped with EUR-selling.
After clinching fresh YTD lows in the proximity of the 128.00 handle earlier in the session, EUR/JPY is now looking to regain the 129.00 level.
EUR/JPY weaker on risk-off trade, soft EUR
The renewed sentiment towards the risk-off trade has motivated investors to increase their positions in the safe haven JPY, forcing the cross to extend the weekly leg lower to the 128.00 neighbourhood, levels last seen in August 2017.
In fact, concerns around the US-China talks and President Trump pouring cold water over his meeting with the North Korean leader next month appear to have reinstated some jitters among market participants.
Moving West, disappointing advanced PMIs in Euroland and Germany for the current month have been also collaborating with the sell off around the shared currency, fuelling fears that the slowdown in the euro bloc might not be that temporary.
EUR/JPY relevant levels
At the moment the cross is losing 1.34% at 128.92 facing the next support at 128.24 (2018 low May 23) followed by 128.00 (low Aug.11 2017) and then 127.56 (monthly low Aug.18 2017). On the upside, a breakout of 130.86 (21-day sma) would expose 131.41 (high May 14) and finally 132.43 (200-day sma).
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