EUR/JPY choppy, regains 116.00 on Abe

The Japanese yen is sharply lower vs. its G10 peers on Wednesday, now sending EUR/JPY back to the 1116.00 area after briefly testing 115.60.

EUR/JPY bid on stimulus chatter

The cross has managed to test fresh highs above the 117.00 handle following renewed market chatter around the (supposedly) imminent announcements of extra stimulus in Japan, although the up move has now ebbed and returned to the 116.00 region.

Japanese PM S.Abe has confirmed that the new stimulus measures will be announced on August 2, comprising so far a package of more than ¥28 trillion (included ¥13 trillion of fiscal stimulus) and the potential issuance of a 50-year bond.

In the meantime, the cross is posting gains for the first time after four consecutive losses bolstered by the current weakness around the safe haven JPY.

EUR/JPY relevant levels

At the moment the cross is up 0.83% at 115.94 facing the immediate hurdle at 118.49 (high Jul.21) ahead of 121.37 (100-day sma) and finally 122.11 (high Jun.24). On the other hand, a breach of 113.98 (50% Fibo of 109.47-118.49) would expose 112.92 (61.8% Fibo of 109.47-118.49) and then 110.54 (low Jul.8).