EUR/JPY struggling to conquer 118.00 barrier, bullish bias remains

The EUR/JPY cross seesawed between tepid gains and minor losses within a broader trading range below 118.00 handle.

Currently trading in neutral territory, around 117.80 region, the cross struggled for a firm direction and was seen consolidating its recent up-surge to 4-month highs. The cross initially dropped to 117.40 region on news of an earthquake in Tokyo and subsequent tsunami warnings for much of the nation's northern Pacific coast. 

The dip, however, was bought into after the Japan Meteorological Agency took back tsunami warnings and amid prevalent risk-on sentiment, which tends to dent the Japanese Yen's safe-haven appeal. Today's price-action further reaffirmed the pair's near-term well-established bullish trend, which could get an additonal boost once the cross decisively moves beyond 118.00 handle. 

In absence of any major economic releases from the Euro-zone and Japanese holiday on Wednesday, broader market risk sentiment would be a key driver ahead of the Euro-zone flash PMI readings during European session on Wednesday. 

Technical levels to watch

On a sustained break through 118.00 handle, the cross seems all set to extend its near-term upward trajectory towards the very important 200-day SMA resistance near 118.70 region. On the downside, 117.35-30 area seems to have emerged as immediate support, which if broken is likely to drag the cross below 117.00 handle towards an important horizontal support near 116.60-50 region.

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