EUR/JPY clocks one-week high

Offered tone around JPY strengthened in Asia on stimulus hopes, pushing the EUR/JPY cross to a one-week high of 114.23 levels.

Trades above weekly 5-MA

The currency pair bounced off from the 10-DMA level of 113.28 to trade above the weekly 5-MA level of 114.00. Yen is being offered on hopes PM Abe is likely to come up with a major fiscal stimulus package that will be supported by BOJ’s easing efforts.

Meanwhile, the EUR/USD pair is resilient, trading above 1.1066 (50% of 1.0517-1.1616) in Asia. This is further adding to the bid tone around EUR/JPY cross. The cross stays at the mercy of the action in the USD/JPY pair. Final German CPI reading could influence the pair as well.

EUR/JPY Technical Levels

Acceptance above the immediate hurdle of 114.09 (38.2% of Brexit drop) could yield a move higher to 115.00 followed by a resistance at 115.60 (50% of Brexit drop). On the other hand, a failure to sustain above the support at 114.00 (weekly 5-MA) would open doors for a slide to 112.94 (June 29 low) and 112.22 (23.6% of Brexit drop).