EUR/JPY alternates gains with losses around 122.00

• EUR/JPY hovers around the 122.00 mark on Wednesday.
• The risk-on sentiment prevails in the global markets.
• Later in the NA session, the FOMC meeting will grab all the attention.

EUR/JPY is extending the weekly correction lower around the 122.00 mark. Managing at least to leave behind weekly lows in the 121.35/30 band recorded on Tuesday.

EUR/JPY now looks to FOMC, data

EUR/JPY is down for the fourth consecutive session on Wednesday, managing to leave behind weekly lows near 121.30 (Tuesday) although still in the negative territory following last week’s YTD peaks beyond 124.00 the figure.

In the meantime, the better tone in the European currency seems to be failing to motivate the cross to reverse the downside, helped by the increasing weakness surrounding the buck (which is also sustaining the demand for the japanese yen).

In the docket, the bulk of the attention is expected to gyrate around the FOMC event later in the NA session, where Powell’s press conference and the revised “dots plot” will surely be in the centre of the debate. Consensus among traders, in the meantime, sees the Fed refraining from acting on rates, while some announcement regarding the ongoing stimulus programme is not ruled out.

EUR/JPY relevant levels

At the moment the cross is gaining 0.08% at 122.27 and faces the next hurdle at 124.43 (2020 high Jun.5) followed by 125.23 (monthly high May 1 2019) and finally 126.79 (monthly high Apr.19 2019). On the flip side, a drop below 121.16 (monthly high Mar.25) would expose 119.44 (200-day SMA) and then 118.71 (100-day SMA).