- The cross moves lower and fades the recent advance.
- Daily support comes so far at the 124.30/25 band.
- JPY strength keeps weighing on the cross.
The demand for the Japanese Yen is now picking up pace and is forcing EUR/JPY to retreat to the 124.40 region after climbing to the boundaries of 124.70 during early trade.
EUR/JPY appears supported around 124.00 this week
Following a promising start of the week, the cross has now come under selling pressure and recedes further after briefly testing weekly highs in the 125.00 neighbourhood on Tuesday.
Increasing demand for the Japanese safe haven in response to declining US yields is forcing USD/JPY to challenge daily lows and is also undermining the continuation of the upside momentum in the cross.
Earlier in the session ECB President M.Draghi reiterated that risks to the growth outlook in the region keep pointing to the downside, while VP L. De Guindos noted the bank’s readiness to protect the economy from weakness seen overseas.
EUR/JPY relevant levels
At the moment the cross is retreating 0.16% at 124.42 and a breach of 123.82 (low Mar.22) would aim for 123.39 (low Jan.15) and then 118.82 (2019 low Jan.3). On the flip side, the initial up barrier emerges at 125.22 (55-day SMA) seconded by 125.77 (21-day SMA) and finally 126.78 (high Mar.20).
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