EUR/JPY weaker, back below 125.00 ahead of key US data

• EUR/JPY recedes further after recording fresh 2020 highs on Friday.
• EUR-selling adds to the offered bias around the cross on Monday.
• Manufacturing PMIs surprised to the upside in the euro area.

After advancing to levels last seen in May 2019 beyond the 125.00 mark, the upside momentum in EUR/JPY deflated and it is now dragging the cross to the 124.30 region (at the time of writing).

EUR/JPY looks to data and risk trends

Friday’s sharp sell-off in the Japanese safe haven encouraged EUR/JPY to surpass the key barrier at 125.00 the figure, area last visited in May 2019.

Monday’s move lower comes on the back of the correction lower in the single currency in light of the strong gains recorded during last month, while the recovery in the greenback is also collaborating with the downside at the beginning of the week.

In the docket, final manufacturing PMIs in the euro area for the month of July added to the idea of a strong recovery in the next months, while investors’ attention will likely be on the US ISM Manufacturing later in the NA session.

EUR/JPY relevant levels

At the moment the cross is losing 0.22% at 124.41 and a drop below 122.87 (monthly high Jan.16) would expose 121.14 (monthly high Mar.25) and then 120.00 (200-day SMA). On the other hand, the next up barrier lines up at 125.20 (2020 high Jul.31) followed by 126.80 (monthly high Apr.17 2019) and finally 127.50 (2019 high Mar.1).