The EUR/JPY’s reversal from three-week highs at 130.35 seen earlier on Tuesday has been short-lived, as the pair found buyers at 130.00 psychological level to defend its near-term upside bias.
The Japanese yen, under pressure amid higher US yields
The solid advance on the US bond yields, with the benchmark 10-year note above 1.5% fuelled by the US Federal Reserve's signals pointing towards the end of the Quantitative Easing era, has been hurting the safe-haven Japanese yen across the board.
In that context, the common currency has taken advantage of a weaker yen, in spite of an energy crisis and the political uncertainty in Germany, which are dampening the Eurozone’s economic growth prospects, to post a five-day rally. The euro has appreciated about 1.75% over the last five days to breach the mentioned 130.00 level and approach two-month highs at 130.70.
EUR/JPY: Next upside target is 130.70
On the upside, above 130.00 psychological level, the next significative area would be at 130.70 (Sept. 3 and 8 highs and the 20-day SMA) then 131.05 (Jul. 14 high), and 132.30 (Jul. 1 high). On the contrary, a reversal below 130.00 might look for support at 129.75 (Sept. 28 low) and 129.40 (Sept 24 low).
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.