- EUR / JPY extends the lateralized move above 130.00.
- US yields and the yen remain in commercial consolidation so far.
- Investor focus shifts to US consumer sentiment, housing data.
The improved tone in the risk space supports the buying interest in the European currency and pushes the EUR/JPY at 130.50 so far Friday.
EUR / JPY watch out for risk trends, data
The consolidation climate prevails in the EUR / JPY since the beginning of the month, always above 130.00 and amid alternating trends of risk appetite and diminishing returns in the US bond market.
In fact, the sell bias in the dollar echoes the renewed downtrend in US 10-year yields and gives the euro wings, all underpinning daily gains so far at the crossover.
At the beginning of Asian business hours and supporting the state of risk appetite, Chinese GDP figures showed that the economy expanded at 18.3% annualized during the January-March period, industrial production increased 14.1% year-on-year through March and retail sales expanded more than 34% annually during the same period.
Closer to home, final headline inflation figures in the euro zone as a whole increased 0.9% month-on-month in March and 1.3% year-on-year. Core CPI also matched preliminary readings and gained 0.9% month-on-month and 1.0% on a yearly basis.
The next thing in the American session will be the publication of the advanced indicator of consumer sentiment for the current month together with the housing data for the month of March.
Technical levels
Right now, the cross is gaining 0.22% to 130.38 and a move past 130.68 (April 7, 2021 high) would pave the way for a test of 131.00 (psychological level) and then 131.98 (July 17 high. 2018). On the downside, the next support lines up at 129.57 (April 8 low) followed by 129.07 (50-day SMA) and finally 128.29 (March 24 weekly low).
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