- EUR / JPY remains practically flat on the day after hovering around the 124.00 level.
- The common currency loses momentum as market sentiment wanes.
- EUR / JPY remains above key support at 123.80.
The euro has been moving back and forth on both sides of the 124.00 level on Thursday, in a slightly negative tone, after reaching a high just above 125.00 earlier this week. Previously seen upside attempts have been capped at 124.50 and the pair returned to 124.00, practically flat on the daily chart.
Yen recovers as risk sentiment turns sour
From a broader perspective, the common currency has been trading within a downtrend channel for the past three days, correcting lower after rising 1.30% amid Monday’s risk rally to confine itself to the resistance area. from 125.10.
The positive market mood observed earlier this week has cooled down over the past few sessions, with investors shifting their focus to the rising COVID-19 cases in the US and Europe. Concerns about the economic impact of the second wave of coronavirus have offset enthusiasm for the vaccine’s progress, with demand for safe-haven currencies like the yen increasing to the detriment of riskier assets like the euro.
EUR / USD: Important support at 123.80
At the moment, the pair remains supported above the confluence of the 50 and 100-day SMAs at 123.80. A clear break below could open the way to 123.15 (Nov 5 high) and 122.05 (Nov 5 and 6 lows). On the upside, immediate resistance is at 124.65 (Nov 11 high) and above here 125.10 (Oct and Nov highs) and Sept 10 high at 126.45.
Credits: Forex Street
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