EUR/JPY trims losses and returns to 121.40 ahead of FOMC
- EUR/JPY regains some shine near 121.40.
- Weekly downside emerges in the vicinity of 121.00.
- ECB Draghi speaks again in Sintra later today.
Following the earlier drop to the vicinity of 121.00 the figure, EUR/JPY has managed to pick up some pace and retake the 121.40/50 band, returning to the positive territory.
EUR/JPY focused on the FOMC event
The better mood around the single currency and in the risk-associated complex in general is now helping the cross to regain some poise amidst a correction lower in the greenback and a persistent offered tone in the Japanese safe haven.
Easing trade tensions after President Trump hinted at the palpable chance to meet China’s Xi Jingpin at the G-20 meeting next week are sustaining the rebound in yields of the us 10-year note, in turn removing tailwinds from the demand for the safe haven JPY.
Later in the day, investors will closely follow the FOMC meeting, with potential interest rate cuts and the renewed ‘dots plot’ taking centre stage. At his subsequent press conference, Chief Jerome Powell is likely to reinforce the dovish stance from the Fed, emphasizing the need to sustain the expansion.
Closer to home, ECB Draghi will give closing remarks at the central bank’s Forum in Sintra. Earlier, German Producer Prices surprised to the downside during May, while EMU Current Account shrunk to €20.9 billion in April.
EUR/JPY relevant levels
At the moment the cross is gaining 0.06% at 121.45 and faces the next hurdle at 122.08 (21-day SMA) followed by 123.17 (high Jun.11) and then 123.75 (high May 21). On the other hand, a breakdown of 121.06 (low Jun.18) would expose 120.78 (low Jun.3) and then 120.54 (monthly low Jan.17 2017).