EUR/JPY bounces-off 3-1/2 year lows, re-takes 119.50

The cross in the EUR/JPY prolongs its downward trajectory for the sixth straight session this Monday, as the yen remains heavily bid amid increased nervousness across the financial markets.

EUR/JPY holds above 119 handle

The EUR/JPY pair drops -0.81% to 119.44, bouncing-off fresh three and a half years lows struck at 119 earlier today. The bears appear to take a breather in Europe, allowing a minor-bounce in the cross as the EUR/USD pair extends recovery above 1.1250 levels, underpinned by persisting risk-off moods.

While the USD/JPY pair also moved-off five-week lows and now reverts towards 106 handle, further aiding the recovery in the EUR/JPY cross. Earlier in Asia, the cross was heavily dumped as risk-off sentiment escalated on the back of rising Brexit concerns and weekend’s terrorist attacks in Orlando, Florida.

Markets also remain cautious and hence, refrain from placing big directional bets ahead of the Fed and BOJ interest rates decision due on Wednesday and Thursday respectively.

EUR/JPY Levels to consider  

The pair has an immediate resistance at 120 (round number) and from there to 120.48 (5-DMA). On the flip side, support is seen at 119 (Multi-year low) below which it could extend losses to towards 118.50.