- EUR / JPY returns to the upper end of the range near 131.70.
- Selling around the JPY continues to fuel the pair’s rally amid higher US yields.
- President Powell will testify later during the American session.
The selling pressure around the Japanese currency increases again and pushes the EUR / JPY cross to the zone of daily highs around the level of 131.70.
EUR / JPY is now targeting the 132.00 level
EUR / JPY now advance for the second day in a row on Tuesday and extends the recovery from the two-month lows near the 130.00 level stalled on Monday.
The slight Positive Tone in US 10-Year Yields Helps with Selling Pressure on the Japanese Yen safe-haven despite global markets remaining skewed toward risk aversion on Tuesday.
The European currency falls under bearish pressure again in response to the resurgence of buying interest around the US dollar, leaving behind the optimistic start to the week.
Additional pressure around selling the euro could also stem from President Lagarde’s comments on Monday, when considered premature any discourse on the modification of the central bank’s monetary policy, adding that tighter monetary conditions could affect the economic recovery.
Later in the day All eyes will be on the testimony of Fed Chairman J.Powell, before the Select Subcommittee for the Coronavirus Crisis on “The Federal Reserve’s Response to the Coronavirus Pandemic.”
EUR / JPY levels
At the time of writing, the EUR / JPY cross is gaining 0.34% on the day, trading at 131.79. A break above 132.13 (50-day SMA), would target 132.97 (20-day SMA) and 134.50 (October 2017 high). On the other hand, the next support is at 130.04 (June 21 low), followed by 129.58 (April 23 low) and finally 128.29 (March 24 low).
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