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EUR/JPY is back to the daily opening rate of 120.43 as the pair is capped by the 20-day ma at 121.14. However, Commerzbank’s Karen Jones favours the topside as the analyst expects further euro strength to retest the 200-week ma at 124.61.

Key quotes

“EUR/JPY remains capped by the 20-day ma at 121.14 very near-term – this is viewed as temporary and we continue to favour the topside.”

“The market recently charted an outside day to the topside (or a bullish engulfing pattern) and recovered off the 200-day ma at 119.60 and the 50% retracement at 119.43. We look for the market to stabilise here and recover further, and we should see the market once again retest the 200-week ma at 124.61. This guards the 128.20 2014-2020 resistance line.”