EUR/JPY drops to 4-day low of 123.90

EUR/JPY extended the two-day losing streak in Asia to a 4-day low of 123.90 levels as a rebound in Japanese nominal pay strengthened the bid tone around the Yen.

Eyes weekly 100-MA

The pair looks set to test the support offered by the weekly 100-MA level of 123.87. The demand for the Japanese Yen rose in Asia after the labor ministry data showed the labor cash earnings/nominal pay in April rose at a fastest pace in four months. The real wages remained flat, although markets are not focusing on the negative aspect as of now.

An upbeat Eurozone Sentix Investor Confidence and Retail Sales, due at 8:30 GMT, could cap the downside in the EUR/JPY cross. The pair could also take cues from the sentiment in the European stock markets.

EUR/JPY Technical Levels

The daily chart shows a symmetrical triangle formation. The bullish crossover between 50-DMA and 100-DMA, confirmed last week, has failed to boost the EUR/JPY pair.

A break below 123.52 (symmetrical triangle support) would expose 123.15 (May 30 low) and 122.56 (May 18 low). On the other hand, a break above 124.45 (5-DMA) could yield 125.00 (zero levels) and 125.31 (June 2 high).