EUR/JPY firmer on Yen-selling, risk-on trade
- Selling pressure around JPY is helping the upside in the cross.
- Shrinking US-China trade concerns add to the selling mood in JPY.
- EMU’s Sentix Index missed estimates in April. ECB-speak next on tap.
The selling bias around the Japanese safe haven has been sustaining today’s upbeat momentum in EUR/JPY, which is flirting with multi-day tops in the 131.65/70 band.
EUR/JPY challenges 4-week tops
The cross is advancing to the 131.70 area following a bout of buying pressure around the single currency, all in response to a sudden correction lower in the greenback and the consequent appreciation in EUR/USD.
In the meantime, markets continue to look to US-China trade conflict for near term direction in the markets. Risk-on sentiment has been supported recently following comments (via Twitter) by President Trump, hinting at the likeliness of an eventual deal between the two countries. However, recent news cited that China could be mulling the idea of depreciating the Yuan in response to US tariffs.
In the data space, Japanese Current Account widened more than expected in February, while the Sentix Index came in below estimates for the current month in the euro area.
EUR/JPY relevant levels
At the moment the cross is up 0.30% at 131.71 facing the next hurdle at 131.84 (high Mar.27) seconded by 132.14 (200-day sma) and finally 132.46 (high Mar.13). On the flip side, a breach of 131.17 (10-day sma) would aim for 129.97 (low Apr.3) and then 129.34 (low Mar.5).