EUR/JPY: at a cliff edge down by the 200-D SMA, profit taking or...?

EUR/JPY is pulling back from the highs and closing the bullish gap created in illiquid early Asian markets at the 21-hr SMA, currently at 131.40. EUR/JPY got a lift on Friday from robust performances on Wall Street.

USD/JPY: thin liquidity opening bullish gap, where next?

The cross often trades like a derivative of the equity market and in the risk-off times, the price in EUR/JPY has moved towards a cliff edge being the 200-D SMA at 131.21. the price has made a low of 130.93 that actually comes in below the previous daily support of 131.16. While the week has started out in a minor correction, the broader bearish tone is dominant and is indeed holding up the bull's progress in EUR/USD. Traders will now look ahead to ECB's Draghi and Coeure as risks for Monday. However, first up we have Kurdo speaking in Parliament at 01.30 today, GMT.

Results of EZ data on Friday (Reuters):

DE GDP Detailed QQ SA Q4, 0.6%, f'cast 0.6%, prev 0.7%.
DE GDP Detailed YY NSA Q4, 2.3%, f'cast 2.3%, prev 2.2%.
DE GDP Detailed YY SA Q4, 2.9%, prev 2.7%.
EZ Inflation Final MM Jan, -0.9%, f'cast -0.9%, prev 0.4%.
EZ Inflation, Final YY Jan, 1.3%, f'cast 1.3%, prev 1.3%.
EZ Infl Ex Food & Energy MM Jan, -1.3%, f'cast -1.6%, prev 0.4%.
EZ Infl Ex Food & Energy YY Jan, 1.2%, f'cast 1.0%, prev 1.2%.

EUR/JPY levels

For the bears, there could be an opportunity here where profit aking comes in at such a crucial level down here at the 200-D SMA some profit-taking, however, 133.00/20/ and 70 would be key levels of resistance and the pair will remain in bearish territory below 134.50/70 area and the 6-month uptrend. For a continuation of the downside, bears will eye 131.18/16 ahead of the 200-W MA at 129.75 and further out.