- Euro rises against the yen for the second day, remains in recent range.
- EUR / JPY with a bearish bias and low volatility.
EUR / JPY is rising for the second day in a row and is trading around 129.70, after having marked highs since Friday at 129.80. The cross maintains a very short-term bullish bias although it faces resistance at the 20-day average.
The advance of the cross is counting on the weakness of the yen in the market. The rise in US Treasury yields works against the yen, which supports the EUR / JPY.
Another extra support for the crossing is the improvement in the mood of the markets. After Tuesday’s positive close, futures on Wall Street are pointing to a mixed open, and in Europe the largest stock exchanges are with gains.
In minutes the US inflation data for July will be published, which can have a wide impact on the market and also the EUR / JPY through what happens with both the USD / JPY but also the EUR / USD. In the first, the uptrend continues, while the second remains close to an important support that is the 1.1700 area.
In the very short term, the support to watch in the EUR / JPY is at 129.65, horizontal level and where the 20-hour moving average is passing. Below the next level is 129.50 and below the floor of these days at 129.35. As you can see, in a broader perspective, the crossover maintains limited volatility.
The Overall bias remains bearish for the euro. A return clearly above 129.80, which is where the 20-day moving average is passing, would strengthen the outlook for the common currency.
Technical levels
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