EUR/JPY: bouncing vs the bearish opening gap towards 130 the figure

Currently, EUR/JPY is trading at 130.57, down -0.14% on the day, having posted a daily high at 130.60 and low at 130.14.

EUR/JPY has attempted to recover since scoring the bearish opening gap's low down at 130.14. EUR/JPY dropped in the open due to the risk aversion following the weekend's news from N.Korea that was firing another missile over Japan and testing a nuclear bomb.

N.Korea tested a hydrogen bomb, it doesn’t look good - ANZ

Meanwhile, the ECB is meeting this week, yet, markets already got a hint on Friday, ironically just when the disappointing nonfarm payrolls was released, that the ECB will not be announcing any guidance in respect to QE which might make for a non-event and possibly weigh on the euro that has risen through the 1.18 handle in recent weeks.  The yen will continue catching a bid as investors shift out of their risk on plays and buy back the safe haven currency.

ECB: 7th September ECB meeting not to offer QE guidance - ANZ

EUR/JPY levels

While the cross is heading towards the psychological 130.00 level, analysts at Commerzbank explained that only if an unexpected drop below the 127.57/46 late June and current August lows were to be seen, they we look for slippage to the May high at 125.81. "Short Term Trend (1-3 weeks): Bid above the 20 day ma (129.61) but caution warranted, this could be a potential expanding top," argued the analysts.