EUR/JPY offered, fades the spike to 120.40 ahead of US ISM
- EUR/JPY gives away earlier gains and approaches 120.00.
- EMU, German final manufacturing PMIs surprised to the upside.
- US ISM Manufacturing next of relevance later in the session.
The recovery in the greenback is putting the euro and the yen under extra pressure today and forced EUR/JPY to erode the earlier climb to daily highs near 120.40.
EUR/JPY focused on China, data
The cross is losing ground on Monday after two consecutive daily advances. However, the pair keeps trading within the multi-session consolidative theme and so far capped by the 100-day SMA near 120.40.
Risk appetite trends continue to dominate investors’ sentiment, with the developments from the Chinese coronavirus and the impact on global growth prospects still in centre stage.
The euro has started the week on a negative note on the back of renewed USD-buying and paying no attention to better-than-expected final manufacturing PMI prints in Euroland for the month of January.
Later in the day, the always-relevant US ISM Manufacturing is expected to show some improvement during last month (48.5 forecasted). Moving forward, the ISM Non-manufacturing, the ADP report and Non-farm Payrolls along with a slew of Fed-speakers throughout the week.
EUR/JPY relevant levels
At the moment the cross is retreating 0.10% at 120.10 and a drop below 119.77 (2020 low Jan.30) would aim for 119.65 (low Nov.25 2019) and then 119.24 (monthly low Nov.14 2019). On the other hand, the next hurdle is located at 120.42 (weekly high Jan.29) followed by 120.65 (200-day SMA) and then 121.05 (55-day SMA).