EUR/JPY in new 3-week highs near 125.60

• Improved risk-on mood pushes the cross higher.
• Brexit talks, EU Summit expected to drive sentiment.
• Next target emerges at the 200-week SMA at 126.92.

The firm note around the European currency is lifting EUR/JPY to challenge fresh multi-week highs in the mid-125.00s.

EUR/JPY looks to risk, ECB

The cross is extending the bounce off monthly lows seen last week in the 123.60/65 band, always on the back of the renewed optimism surrounding the risk-associated complex.

In fact, speculations over the likeliness that US and China could clinch a trade deal sooner rather than later have sparked a fresh bout of buying interest among the riskier assets, pushing the cross further north of the 125.00 mark.

In the calendar, the next big event will be tomorrow’s ECB meeting, where investors will look for further details on the recently announced TLTRO-III and the probable implementation of a tiered deposit rate system.

EUR/JPY relevant levels

At the moment the cross is gaining 0.02% at 125.53 and faces the next hurdle at 125.96 (100-day SMA) seconded by 126.78 (high Mar.20) and finally 126.92 (200-week SMA). On the other hand, a breach of 124.91 (10-day SMA) would expose 123.65 (low Mar.28) and then 123.39 (low Jan.15).