EUR/JPY keeps gains above 129.00 on BOJ, focus shifts to ECB

The offered tone behind the Japanese yen weakened a bit on the release of the BOJ policy decision and quarterly economic report, now pushing EUR/JPY further beyond 129 handle.

EUR/JPY: Will it regain 129.80 on ECB?

The EUR/JPY pair now rises +0.16% to trade near daily tops of 129.15 levels, having found fresh buyers at 128.80. The cross remains on the front foot so far this session, with the upside gaining traction on renewed JPY weakness after the BOJ scaled back CPI expectations for the next three years, leaving the monetary policy settings unchanged, while also signaling that it will continue to maintain its accommodative monetary policy stance.

On the EUR-side of the equation, the EUR/USD pair trades near daily lows just ahead of 1.15 handle, offering little impetus to the cross, as investors remain on the edge ahead of the much-awaited ECB monetary policy decision, with a hawkish bias widely expected.

In the meantime, the pair may also take fresh cues from the BOJ Governor Kuroda’s post-policy press conference due around 0630 GMT.

EUR/JPY: Technical Levels                               

Higher side: 129.39/50 (10-DMA/ psychological levels), 130 (round figure), 130.72/81 (multi-month tops)

Lower side: 128.58 (Jul 19 low), 127.99 (classic S2/ Fib S3), 126.44 (Jun 28 low)