EUR/JPY upside halted near 120.00, 10-day SMA

• EUR/JPY run out of steam near the 120.00 handle in early trade.
• The Japanese currency loses some ground as US yields rebound.
• China government said the Yuan is unlikely to depreciate further.

After advancing to the proximity of 120.00 the figure during the Asian trading hours, EUR/JPY lost some upside feeling and has now returned to the 119.20 area, still positive for the day.

EUR/JPY looks to trade

The cross is advancing for the second session in a row on Tuesday, extending the rebound after Monday’s drop to sub-118.00 levels, area last visited on April 2017.

The resurgence of some selling bias in the Japanese safe haven on the back of the mild recovery in US yields has given much-needed oxygen to the cross in past hours, although the 120.00 handle emerged as a tough hurdle for the time being.

Moving forward, the developments around the US-China trade dispute and potential retaliatory measures by China should rule the global sentiment for the foreseeable future, while a deal looks farther away with every day.

In today’s docket, finally some auspicious news in the German economy saw Factory Orders expanding more than expected during June, lending some initial support to EUR.

EUR/JPY relevant levels

At the moment the cross is gaining 0.29% at 119.02 and faces the next hurdle at 119.87 (high Aug.6) followed by 120.03 (10-day SMA) and then 120.73 (21-day SMA) and then 121.37 (high Jul.25). On the downside, a breakdown of 117.67 (2019 low Aug.5) would open the door to 114.85 (2017 low Apr.17) and finally 113.71 (monthly low Nov.9 2016).