EUR/JPY extends the side-lined theme around 130.00
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EUR/JPY extends the side-lined theme around 130.00

  • EUR/JPY keeps the rangebound trade unchanged on Monday.
  • JPY-buying dragged the cross to as low as the 129.70 earlier.
  • Japan’s flash Industrial Production contracted 1.3% MoM in February.

The increased buying pressure around the Japanese yen weighs on EUR/JPY and keeps it within the usual rangebound theme around the 130.00 level.

EUR/JPY looks to yields, risk

The persistent sell-off in the greenback gave extra strength to the European currency and the rest of the risk complex at the beginning of the week.

However, steady/declining US yields added to the buying sentiment around the Japanese safe haven, all rendering into further consolidation around the cross and undermining the EUR-led upside potential.

In the calendar, advanced figures in Japan saw the Industrial Production contracting at a monthly 1.3% during February, while the Adjusted trade surplus widened to ¥663.7 billion in March. Closer to home, the Current Account surplus in the broader Euroland more than doubled in February to €13.3 billion.

EUR/JPY relevant levels

At the moment the cross is losing 0.12% at 130.13 and faces the next support at 129.57 (low Apr.8) followed by 129.13 (50-day SMA) and finally 128.29 (weekly low Mar.24). On the flip side, a move past 130.68 (2021 high Apr.7) would pave the way for a test of 131.00 (psychological level) and then 131.98 (2018 high Jul.17).

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