EUR / JPY retraces from new highs above 130.00

• EUR / JPY moves past the 130.00 hurdle on Tuesday.
• Broad-based risk appetite supports the crossover.
• The general CPI of the EMU reached a 10-year high of 3.0%.

The best tone in the space associated with risk sustains the upward momentum of the EUR/JPY at levels beyond the key psychological level of 130.00 on Tuesday.

EUR / JPY shifts attention to US data

EUR / JPY extends the bounce from monthly lows just below 128.00 (Aug 19) and finally manages to break above the key 130.00 barrier in the first half of the week.

In fact, sellers are keeping the dollar under increasing pressure as investors continue to adjust to Powell’s speech last Friday, while month-end flows and profit-taking also contribute to the stance offered in the dollar.

The cross is moving higher and the risk appetite remains optimistic despite the disappointing results of the Chinese economy during the first operations. In fact, the manufacturing PMI fell to 50-1 in August and the services indicator returned to contraction territory (50) at 47.5.

Earlier on the euro agenda, preliminary inflation figures for the euro area as a whole rose to a decade-high 3.0% for the current month, while the unemployment rate in Germany declined to 5.5%. in the same period.

On the other hand, the FHFA house price index rose 1.7% month-on-month in June. The S & P / Case-Shiler index was up 18.5% year-on-year through June. Later, the Chicago PMI will also be released followed by the ever-relevant Consumer Confidence figures as measured by the Conference Board.

Relevant levels

So far, the cross is gaining 0.16% to 129.85 and a breakout of 130.17 (August 31 weekly high) would expose 130.56 (July 29 weekly high) and then 131.08 (100-day SMA). On the downside, the next support comes at 129.35 (200-day SMA) followed by 127.93 (August 19 monthly low) and finally 127.00 (round level).