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EUR/JPY keeps the consolidation above 130.00 ahead of US data

  • EUR/JPY extends the rangebound trading beyond the 130.00 level.
  • The greenback remains offered ahead of important data releases.
  • US 10-year yields trend lower and approach the 1.60% support.

The broad-based steady performance of the European currency and the Japanese safe haven motivates EUR/JPY to extend further the consolidative note above the 130.00 mark on Thursday.

EUR/JPY keeps targeting the 2021 highs near 130.70

Declining US yields have removed strength from the greenback and leaves it vulnerable to further decline in the very near-term along with the renewed investors’ preference for riskier assets, all morphing into extra legs for the euro

The Japanese yen, in the meantime, keeps tracking the generalized lack of volatility and the steady activity in US yields and extends the neutral/bearish fashion seen in past sessions.

In fact, volatility tracked by the VIX index (aka the “panic index”) looks to stabilize in fresh lows around 16.0, area last seen in February 2020.

In the euro calendar, German final inflation figures for the month of March showed the CPI rose 0.5% MoM and 1.7% YoY.

Investors’ attention, however, will be on the US docket, with March’s Retail Sales and weekly Claims taking centre stage and seconded in relevance by the Philly Fed Index, the NY Empire State Index, Industrial Production, Capacity Utilization, Business Inventories, NAHB Index and TIC Flows.

Further out FOMC’s Bostic, Daly and Mester will speak later in the NA session.

EUR/JPY relevant levels

At the moment the cross is losing 0.18% at 130.21 and a drop below 129.57 (low Apr.8) would expose 129.00 (50-day SMA) and finally 128.29 (weekly low Mar.24). On the other hand, the next hurdle emerges at 130.68 (2021 high Apr.7) seconded by 131.00 (psychological level) and then 131.98 (2018 high Jul.17).

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