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Karen Jones, Team Head FICC Technical Analysis at Commerzbank, noted that occasional bullish attempts in the cross are expected to face initial resistance in the 120.50 region.

Key Quotes

EUR/JPY saw a decent bounce from the 55 day ma last week, this is located at 119.35 currently. Rallies should find initial resistance at the 20 day ma at 120.54. This guards tougher resistance, at 121.34/85. This is the location of the 200 day ma, the 50% Fibonacci retracement and the late July high”.

“While capped here attention remains on the 118.61 uptrend. This should hold the initial test, however longer term the risk has increased for a break lower. Failure here will target the 117.09 October low ahead of the 115.87 September low”.