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EUR / JPY retreats from highs in months after failing to break 127.00

  • EUR / JPY trim gains later after breaking 126.60.
  • Wall Street turns negative and pressures EUR / JPY down.

He EUR / JPY rose to 127.01, the highest intraday level since September 1 and then undertook a retracement to the 126.50 / 55 zone. The drop was driven by a decline in stocks on Wall Street and a recovery in the dollar.

The greenback gained momentum and cut losses, which contributed to the EUR / JPY failing to break 127.00. That level is a key resistance and a close above it would enable more raises. Now the price is about to return below 126.50, which would put the focus back on the consolidation between 126.70 and 125.70.

The euro is rising for the third day in a row against the yen, although it is a long way from the day’s highs, which can be seen as a sign of possible exhaustion to the upside.

The yen is losing strength due to a rise in USD / JPY, but at the same time the retracement of the EUR / USD, put limits on the advance of the EUR / JPY. The crossover is at key levels.

A continuation of the decline on Wall Street would play against further increases in the EUR / JPY. The focus of attention is on coronavirus cases, vaccination and the negotiations for Brexit and the new stimuli in the US.

Technical levels

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