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EUR/JPY clings to daily gains near 121.60

  • EUR/JPY rebounds from weekly lows, back near 121.60.
  • EMU Retail Sales contracted more than expected in May.
  • Volatility, trade conditions remain thin on US holiday.

After bottoming out in multi-day lows near 121.30 on Wednesday, EUR/JPY managed to regain some composure and is now advancing to the 121.60 region amidst thin trade conditions.

EUR/JPY supported around 121.30

The cross exchanges gains with losses in the second half of the week following the generalized consolidative trade in the global markets, all in response to scarce volatility and thin trade conditions as US markets are closed due to the Independence Day holiday.

In the meantime, market participants continue to look to the US-China trade front with increasing scepticism over the resumption of the negotiations in the near term, while speculations over a Fed move on rates have resurfaced in the wake of poor prints from the US docket as of late.

Also somewhat limiting bullish attempts in EUR, the idea that ex-IMF’s C.Lagarde will dictate the monetary policy in the region from November keep weighing on investors’ mood.

Earlier in the session, EMU Retail Sales contracted 0.3% inter-month during May and expanded at an annualized 1.3%, both readings coming in short of expectations.

EUR/JPY relevant levels

At the moment the cross is gaining 0.07% at 121.65 and faces the next hurdle at 122.07 (21-day SMA) seconded by 122.86 (55-day SMA) and then 123.35 (high Jul.1). On the other hand, a breakdown of 121.31 (low Jul.3) would expose 120.95 (low Jun.21) and finally 120.95 (low Jun.21).

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