EUR/JPY remains unable to consolidate above 123.00

EUR/JPY is falling marginally on Monday, currently at 122.85, down less than 10 pips from Friday’s closing price. 

The pair earlier today peaked at 123.50 but quickly bounced back under 1.2300. It bottomed at 122.77. For the fifth trading day in a row, EUR/JPY was unable to hold above 123.00. That area continues to be a key resistance. A consolidation significantly above could open the doors to more gains and a possible test of 124.00. 

To the downside, the key support could be seen around the 121.50 area. That zone offered support last week and also earlier in December. A daily close below, could change the short-term tone from bullish/sideways to bearish, increasing the chances of the correction that could lead to a test of 120.00

A quiet day, only PMI

Markets continue on holiday mode with low volatility. In the news front, the most important report today was the Eurozone PMI. The headline number came in line with expectation at 54.9 (similar to the flash), the highest reading since April 2011. “Eurozone manufacturers are entering 2017 on a strong footing, having ended 2016 with a surge in production”, said Chris Williamson, Chief Business Economist at Markit. 

Ahead, no data from Japan is expected on Tuesday while in Europe, attention would be on inflation numbers from Germany.