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  • EUR/JPY met daily contention in the 117.00 mark on Monday.
  • German Business Climate came in above estimates in May.
  • Trade conditions remain flat following the US Memorial Day holiday.

The now better tone in the single currency is giving EUR/JPY extra wings, pushing it above the key 117.00 mark at the beginning of the week.

EUR/JPY focused on risk trends

EUR/JPY has managed to regain some poise after the earlier test of lows in the 117.00 neighbourhood, reversing at the same time two consecutive daily pullbacks, including the rejection from monthly tops in the mid-118.00s (May 21).

The risk-off sentiment looks somewhat mitigated at the beginning of the week, helped indirectly by the lack of activity in the US markets due to the Memorial Day holiday.

Earlier in the session, the German IFO survey came in on a positive note, improving the mood around the euro and collaborating with the daily upside. In fact, the German Business Climate rebounded to 79.5 for the current month, surpassing previous estimates.

Moving forward, investors’ attention will likely be focused on the US-China trade scenario, as well as, developments from the increasingly unstable situation between Hong Kong and China.

EUR/JPY relevant levels

At the moment the cross is gaining 0.13% at 117.45 and faces the next hurdle at 117.72 (monthly high May 21) followed by 119.03 (monthly high Apr.7) and finally 119.23 (200-day SMA). On the flip side, a drop below 116.99 (low May 22) would expose 115.44 (monthly low Apr.29) and then 114.39 (2020 low May 7).