- EUR/JPY adds to recent gains near the 127.00 hurdle.
- The weakness around the dollar sustains the buying interest.
- Markets’ attention will be on weekly Claims, Fed.
The soft mood around the greenback continues to lend support to the riskier assets and encourages EUR/JPY to retake tops in the 127.00 neighbourhood on Thursday.
EUR/JPY looks to risk trends
Following the recent inconclusive price action, EUR/JPY manages well to pick up extra pace and advance once again to the key 127.00 neighbourhood in the second half of the week.
The persistent weakness surrounding the greenback allows for the continuation of the buying interest in the risk-associated assets, although the recent decline in US yields appears to have lent some support to the Japanese yen
Events wise in the euro area, the European Commission (EC) now sees the economy of the bloc expanding 3.8% this year and 3.8% in 2022 (from 4.2% and 3.0% in the Autumn 2020 report, respectively). Regarding inflation, the EC expects consumer prices to rise 1.4% in 2021 and 1.3% during the next year (from 1.1% and 1.3%, respectively).
Later in the NA session, investors’ focus will be as usual on the weekly Claims ahead of the Fed’s Monetary Policy Report.
EUR/JPY relevant levels
At the moment the cross is gaining 0.23% at 127.02 and faces the next up barrier at 127.49 (2021 high Jan.7) followed by 130.18 (monthly high Nov.7 2018) and then 133.13 (monthly high Sep.21 2018). On the other hand, a drop below 126.10 (monthly low Feb.4) would aim for 125.59 (low Jan.27) and finally 125.08 (2021 low Jan.18).
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