- EUR / JPY corrects lower from yearly highs near 128.50.
- Buying pressure on the dollar weighs on the cross.
- US retail sales expanded 5.3% monthly in January.
After hitting new 2021 highs at 128.50 during early trading, the EUR/JPY reverse those gains and pull back to the 128.00 zone and below.
EUR / JPY weakened by risk aversion
EUR / JPY is correcting lower for the first time after six consecutive daily gains, and is under some selling pressure shortly after hitting the 128.50 region on Wednesday, the area last seen in December 2018.
The strong rally in US yields encourages the US dollar to move past recent weakness and refocus to the upside, pushing the US dollar index (DXY) to multi-day highs near 91.00 and forcing the risk complex to lose ground.
On the agenda, Japan’s adjusted trade balance figures showed that the trade surplus narrowed to 0.39 trillion yen in January. In the US data space, general retail sales surprised to the upside in January and expanded 5.3% monthly, while basic sales also rose above the estimates of 5.9% monthly. Later in the US record, industrial production figures are to be supported by the FOMC Minutes.
Technical levels
Right now, the cross is losing 0.37% at 127.88 and a drop below 127.49 (January 7 monthly high) would point to 126.10 (February 4 monthly low) and finally 125.08 (January 18 low). 2021). On the other hand, the next barrier emerges at 128.45 (maximum of February 17, 2021) followed by 129.25 (monthly maximum of December 13, 2018) and then 130.14 (monthly maximum of November 7, 2018).
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
