EUR/JPY slumps to the 119.00 region, weekly lows

• EUR/JPY collapses to the vicinity of the 119.00 mark.
• Persistent demand for safe havens supports the Japanese yen.
• German flash CPI came in better-than-expected in February.

The strong comeback of the Japanese yen has undermined the recent recovery in EUR/JPY, exposing it to another visit to the 119.00 neighbourhood, or weekly lows.

EUR/JPY focused on coronavirus

EUR/JPY is reversing two consecutive daily advances at the end of the week, returning to the 119.00 area after being rejected from weekly tops near the 121.00 mark on Monday and Thursday.

The Japanese yen appears to be investors’ preferred safe haven in the past couple of sessions in response to heightened concerns surrounding the fast-spreading (and still out of control) COVID-19, forcing both EUR/JPY and USD/JPY to recede from recent tops.

In addition, the cross remained largely apathetic on the better-than-expected flash inflation figures and results from the labour market report in Germany, while concerns over the possibility of the Japanese economy entering into recession in the next months now looks somewhat subsided.

EUR/JPY relevant levels

At the moment the cross is losing 1.18% at 119.08 and a drop below 118.46 (2020 low Feb.18) would aim for 117.07 (monthly low Oct.7 2019) and finally 115.86 (2019 low Sep.3). On the other hand, the next resistance lines up at 120.92 (55-day SMA) followed by 121.39 (weekly high Feb.20) and then 122.65 (monthly high Dec.13).