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Forex: EUR/JPY erasing daily losses to 129.54

FXstreet.com (Barcelona) - Brought down on Tuesday by both Yen strength on profit taking from Monday’s high at 130.67 and EUR weakness in reaction to the disappointing flash PMI report in Germany, the EUR/JPY fell to as low at 127.88 on the European session and bouncing movement was formed in anticipation of the NY session, as investors saw improving yields on Italy and Spain debt, European equities rise and the Yen weakens. So far, the cross peaked at 129.60 session high as the market finds resistance at yesterday’s close of 129.54.

Despite the Bank of Spain’s announcement of 0.5% contraction of GDP Q1, the country was able to sell a total of €3.010B of 3-months (average yield at 0.12%, from 0.285% in March-19) and 9-month debt (average yield at 0.787%, from previous 1.007%).

Disappointing market analysts, the manufacturing index by Richmond Fed fell from 3 to -6 in April, instead of rising to 7 as expected. The April new home sales report registered a 1.5% rise, from 0.411M to 0.417M, staying below the 0.420M consensus. The March drop was revised higher from -4.6% to -7.6%.

Mataf.net analysts point to resistance at 129.80. On the downside, supports might be found at 127.70, 127.10 and 126.45.

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