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Forex: EUR/JPY pressured below 128.00

FXstreet.com (Barcelona) - The EUR/JPY fell below the 128.00 as the US manufacturing survey by Philly Fed was released along with IMF Lagarde’s remarks that the ECB clearly has room to ease more. Also, a rumor that a French bank may be in trouble is leaving investors apprehensive. The cross dropped to 127.58 session low, but is now quoting around 127.75.

In April, the manufacturing survey by Philadelphia Fed dropped from 2.0 to 1.3 instead of rising to 3.3, as expected by consensus. New orders fell from -0.5 to -1.0 and employment tumbled from -2.7 to -6.8. Following a 0.5% rise in February, the CB Leading Indicator contracted by -0.1% in March. Market consensus was suggesting an improvement of 0.1%.

US initial jobless claims came 2K higher than expected, at 352K in the April-13 week, and the prior week’s figure was revised higher by 2K, to 348K. Continuing claims fell from 3.108M to 3.068M, below the 3.075M consensus. And the prior week’s data was revised higher from 3.079M to 3.103M.

The market printed its daily high at 128.78, 100 pips above the current price, but option activity strengthen the Yen.
“The EUR/JPY has broken its hourly support at 128.25 (intraday low) after failing to break the hourly resistance at 129.85”, wrote MIG Bank analysts Bijoy Kar and Luc Luyet, pointing to hourly supports at 126.44 (17/04/2013 low) and 124.94 (16/04/2013 low).

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