- EUR / JPY climbs to a 2-day high near 129.40 on Monday.
- Risk appetite continues to weigh on the dollar.
The EUR/JPY it leaves the initial pessimism behind and surpasses the key barrier of 129.00 at the beginning of the week.
EUR / JPY strengthened by risk appetite
EUR / JPY manages to advance past 129.00 at the beginning of the week, making a rather subdued comeback after bottoming out at 128.50 earlier in the session.
In fact, the prevailing risk appetite sentiment favors the sell bias in the Japanese yen and sends the cross higher, although the bull run appears to have lost steam at the 129.40 zone so far.
Higher returns in the US in response to the sell-off in the fixed income space sponsor the sales momentum in the Japanese yen and the dollar, which translates into a further increase in the EUR / JPY.
Technical levels
So far, the cross is up 0.40% to 129.25 and a breakout of 129.71 (200-day SMA) would expose 130.47 (weekly high on Sept. 29) and then 130.67 (100-day SMA). On the downside, the next support comes at 128.51 (October 4 low) followed by 127.93 (September 23 monthly low) and finally 127.00 (round level).
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