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The yen was one of the biggest winners of today’s Asian session trading as markets priced in coronavirus and geopolitical risks.

Can the euro regain pips against the yen in the next couple of hours?

Before we check out today’s chart, read up on the major headlines during the Asian session:

Major Forex Pairs Price Performance from MarketMilk
Major Forex Pairs Price Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

  • U.K.’s retail sales at 6:00 am GMT
  • France’s manufacturing and services PMIs at 7:15 am GMT
  • Germany’s manufacturing and services PMIs at 7:30 am GMT
  • Eurozone’s manufacturing and services PMIs at 8:00 am GMT
  • U.K.’s manufacturing and services PMIs at 8:30 am GMT
  • U.S. manufacturing and services PMIs at 1:45 pm GMT

What to Watch: EUR/JPY

EUR/JPY 1-hour Forex Chart
EUR/JPY 1-hour Forex Chart

Earlier today we saw the yen gain across the board as forex traders took cues from a low key risk-averse U.S. session trading.

This time around, markets are anxious that rising coronavirus cases worried Trump enough to postpone a key rally in Florida. It also didn’t help risk-takers that U.S. Secretary of State Mike Pompeo went hard against China in his latest speech.

Will risk aversion extend to London session trading?

EUR/JPY is now trading at its 1-hour 100 SMA support, which isn’t far from a trend line that EUR/JPY traders have been paying attention to since early June.

If today’s PMI reports from France, Germany, and the Eurozone miss expectations of a bounce in July, then we could see EUR/JPY break below its trend line support to test the 200 SMA.

If today’s releases print as or better than markets are expecting, however, or if euro traders remember that they’re still happy about the EU’s recovery deal this week, then we could see EUR/JPY retest its weekly highs closer to the 124.25 – 124.50 area.