EUR/JPY erases gains, back below 124.00

EUR/JPY rose to 2-week highs during the European session and peaked at 124.63 but failed to hold and pulled back sharply, erasing all gains.

Currently is trading at 123.85/90, around the same level it closed yesterday. From daily highs it had fallen 80 pips amid a stronger Japanese yen that rallied during the last two hours, boosted by a decline in equities. In the US, the Dow Jones index that opened the day in positive territory and now is falling 0.34% while the Nasdaq declines 0.93%, affected by a 2.75% decline in Apple.

EUR/JPY to test 123.50 again?

The pair weakened during the last hours and now intraday momentum favors the downside. If it continues to decline it could drop to test the 123.50 area, where yesterday’s lows and the 20-day moving average are located. A break lower could expose the next support at 123.20.

If it manages to stay on top, the EUR/JPY could retain some bullish perspective but in order to clear the way for more gains it needs to surpass the 124.60 zone, where the 55-DMA currently stand. Once above it could climb to test a relevant dynamic resistance, the downtrend line at 125.50, from January highs.