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In the view of Karen Jones, Analyst at Commerzbank, the EUR/JPY cross remains exposed to further downside risks.

Key Quotes:

“EUR/JPY has once again balked ahead of the 55-day ma at 129.52 and the 2018 downtrend line at 129.81. The risk remains that we will see failure and a slide back to 125.75, which is the last defense for the 124.62 recent low. Below 124.62 there is scope for a slide to the 124.08 December 2016 high. Between here and the 50% retracement at 123.40 we expect to see some profit-taking. Below here would target 120.10/00.

Near-term should a break above the downtrend be seen, we would be unable to rule out the scope for further gains to the 131.34/48 May highs and possibly even for the 133.48 April peak.”