EUR / JPY weakens further, approaching 131.00

• EUR / JPY resumes falling and is trading near 131.00.
• The Japanese yen gains traction amid falling US yields.
• Durable goods orders from the US are next on the calendar.

The softer tone in the European currency coupled with the upward pressure in the Japanese safe haven motivates the EUR/JPY to recede even closer to 131.00.

EUR / JPY faces provisional support around 130.60

EUR / JPY reverses Monday’s rally and is trading at multi-day lows near the 131.00 area due to mounting selling pressure surrounding the single currency and the bias offered in the yen.

Indeed, the continued buoyant tone in the dollar continues to weigh on the euro, while falling yields in the United States lend additional support to demand for the Japanese currency.

In fact, yields on the key US 10-year bond. they broke below the 1.60% level, simultaneously hitting new 5-day lows and forcing the dollar to cut back some of the initial gains.

It is a public holiday in Japan, while in the US data space the trade deficit widened to $ 74.40 billion in March (from $ 70.50 billion) before the release of the figures for the IBD / TIPP index, durable goods orders and API’s weekly report on US crude oil supplies.

Technical levels

So far, the cross is shedding 0.26% at 131.21 and faces immediate contention at 130.00 (key level) seconded by 129.89 (50-day SMA) and finally 129.58 (April 23 weekly low). On the other hand, a pass of 132.36 (maximum of April 29, 2021) would pave the way for a test of 133.00 (psychological obstacle) and then of 133.13 (monthly maximum of September 21, 2018).