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    EUR/JPY slips back under 125.00

    © Dukascopy Bank SA
    "Too much is being priced in to the euro for the ECB., even if they were to cut by 20 basis points and introduce tiering of rates, it would be hard for the euro or the bond market to go further than where they are. We think there is a risk that the euro bounces. Our top way to play this is buying the euro against the yen." 
    - BNP Paribas (based on Reuters) 

    Pair's Outlook 
    The European single currency appreciated against the Japanese Yen last Friday, reaching its two-week high. However, ECB easing expectations earlier today weakened the Euro, and, as a result, the pair returned under the 125.00 level. The resistance level, represented by the monthly PP, also played its part in the EUR/JPY trend reversal. The cross now faces a support at 124.29, namely the weekly PP, which should limit the losses today. In case this support is breached, demand at the 124.00 psychological might be sufficient to keep the pair from falling deeper down. Technical indicators are also in favour of the bearish scenario. 

    Traders' Sentiment 
    Market sentiment shifted to the bearish side, as 52% of traders now hold short positions, compared to 50% on Friday.
    © Dukascopy Bank SA

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