EUR/JPY slides farther below 121.00 mark amid risk-off mood

Having posted a session high level beyond the 121.00 handle, the EUR/JPY cross ran through fresh offers and snapped three consecutive days of winning streak.

A fresh wave of selling pressure around the shared currency emerged during early European session on news report that French Presidential candidate Juppe ruled himself out of the elections. The news triggered a sell-off in the French bond markets, and widened the French-German 10-year bond yield differential, with spot accelerating the downslide from the vicinity of Friday's two-week highs.

Against the backdrop of prevalent risk-off mood after North Korea fired four ballistic missiles into the sea off Japan’s northwest coast, growing political uncertainty in the Euro-area further boosted the Japanese Yen's safe-haven appeal and collaborated to the offered surrounding the cross.

Meanwhile, the release of upbeat Sentix Investor Confidence data from the Euro-zone did little to provide an immediate respite of the shared currency, with cautious investors' sentiment being an exclusive driver of the pair's movement on Monday.

Technical levels to watch

Immediate support on the downside is pegged near 120.20 level, below which the cross is likely to head back towards testing 100-day SMA support near 119.65-60 region. On the upside, 121.00 handle now seems to have emerged as immediate strong resistance, which if cleared should now assist the cross to surpass the 121.20-25 strong resistance and aim towards reclaiming the 122.00 round figure mark.

AG Markets Review