EUR/JPY faces strong resistance in the 120.00 area

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  • EUR/JPY extends the upside to the 120.00 mark on Monday.
  • Risk-on sentiment is behind the move to 3-month tops.
  • US ISM Manufacturing next of relevance in the calendar.

The improved appetite for riskier assets has lifted EUR/JPY to levels just shy of 120.00 the figure earlier in the session.

EUR/JPY looks to risk trends, data

EUR/JPY is trading on a firm note at the beginning of the week and is extending the recovery for the sixth consecutive session, always bolstered by the better mood in the risk complex.

In fact, the persistent offered bias in the greenback and the Japanese safe haven are lending extra oxygen to the cross at the beginning of the week, although a surpass of the 120.00 yardstick still remains elusive.

In the docket, both German and EMU final manufacturing PMIs came in a tad below the preliminary readings in May, while the focus of attention remains on the upcoming ISM Manufacturing in the NA session.

It is worth mentioning that odds for the continuation of the rally stays on the rise, particularly if the breakout of the 4-month resistance line extends further north (currently around 119.40) on a more sustainable fashion.

EUR/JPY relevant levels

At the moment the cross is gaining 0.05% at 119.72 and faces the next hurdle at 119.97 (monthly high Jun.1) followed by 121.14 (monthly high Mar.25) and finally 121.39 (monthly high Feb.20). On the flip side, a drop below 119.26 (200-day SMA) would expose 118.68 (100-day SMA) and then 116.99 (low May 22).

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