EUR/JPY reverses the upside and drops to lows near 117.40
- EUR/JPY fades the move to the 118.00 area, returns to 117.40.
- Declining US yields lift the demand for JPY.
- Markets’ focus shifted to Brexit, trade and Fed’s Powell.
The now buying pressure around the Japanese safe haven has forced EUR/JPY to recede from the proximity of the 118.00 handle to the current 117.40 region.
EUR/JPY focused on trade, Powell’s speech
After two consecutive daily gains, the cross is now reversing the positive streak and is shifting the attention to the lower end of the range in the 117.00 neighbourhood, which it has so far held the downside.
Yields of the key US 10-year note have abruptly abandoned the area of daily highs near 1.60% after news cited the White House could be looking into capping the participation of Chinese stocks in the government fund.
Later in the day, US Producer Prices are due seconded by the speech by Fed’s J.Powell at the NABE Conference in Denver.
Earlier in the day, German Industrial Production expanded more than forecasted, supporting further the upbeat momentum surrounding the shared currency.
EUR/JPY relevant levels
At the moment the cross is retreating 0.19% at 117.43 and a breach of 117.07 (monthly low Oct.3/7) would expose 116.56 (low Aug.26) and finally 115.86 (2019 low Sep.3). On the other hand, the initial resistance emerges at 118.43 (55-day SMA) seconded by 120.01 (monthly high Sep.13) and then 119.98 (100-day SMA).