2 May 2016
EUR/JPY drops back to 122.00 important handle
The EUR/JPY pair erased some of its early morning gains to 122.33 and has now moved back to a very important 122.00 handle ahead of the final print of Euro-zone manufacturing PMIs.
Last week, the pair reversed all of its previous week gains and gains recorded during the early half of the week after the Bank of Japan decided to stand pat and crush market expectations of announcing additional stimulus measures to boost country's sluggish economy and fight inflation. The pair fell sharply below 122.00 mark and closed below the handle for the first time since March 2013.
The pair on Monday attempted a minor recovery from lower levels but the recovery was short-lived, dragging the pair back towards 122.00 handle.
Technical levels to watch
In order to stage any recovery the pair needs to hold the 122.00 important handle, which if broken opens room for an immediate drop towards 121.00 mark before extending the fall to test its next major support near 119.20-119.00 area in the near-term.
Meanwhile on the upside, 122.50-60 seems to provide immediate hurdle, which if conquered sets the stage for additional recovery, possibly beyond 123.00 round figure mark, towards 123.50-60 region.
Last week, the pair reversed all of its previous week gains and gains recorded during the early half of the week after the Bank of Japan decided to stand pat and crush market expectations of announcing additional stimulus measures to boost country's sluggish economy and fight inflation. The pair fell sharply below 122.00 mark and closed below the handle for the first time since March 2013.
The pair on Monday attempted a minor recovery from lower levels but the recovery was short-lived, dragging the pair back towards 122.00 handle.
Technical levels to watch
In order to stage any recovery the pair needs to hold the 122.00 important handle, which if broken opens room for an immediate drop towards 121.00 mark before extending the fall to test its next major support near 119.20-119.00 area in the near-term.
Meanwhile on the upside, 122.50-60 seems to provide immediate hurdle, which if conquered sets the stage for additional recovery, possibly beyond 123.00 round figure mark, towards 123.50-60 region.