- EUR / JPY is down from weekly highs near 130.50.
- The prevailing mood of risk aversion weighs on the crossover.
- Powell, Lagarde will discuss politics at the ECB Forum.
The EUR/JPY came under renewed selling pressure shortly after hitting new weekly highs in the region of 130.50 on Wednesday.
EUR/JPY limited by 130.50
EUR / JPY fades the initial rally to new weekly highs and thus halts a 5-session positive streak, with moderate resistance emerging at 130.50 for the time being.
End-of-the-month flows, stable US yields along the curve, and some negative news around Chinese real estate developer Evergrande kept the risk complex exodus in favor of the dollar and helped the US dollar index. (DXY) to record new highs of 2021 near 94.00.
On the euro agenda, German import prices surprised to the upside in August, while the final impression of consumer confidence in the euro zone measured by the European Commission reached -4 for the current month.
Later in the session, investors are expected to closely follow the policy debate between Powell, Lagarde, Kuroda and Bailey at the ECB Forum in Sintra.
Technical levels
So far, the cross is down 0.19% to 129.98 and a break above 130.47 (September 29 weekly high) would expose 130.74 (September 3 monthly high) and then 130.78 (100-day SMA). On the downside, the next support comes at 129.67 (200-day SMA) followed by 129.39 (Fibonacci level) and finally 127.93 (September 22 monthly low).
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