EUR/JPY drops to daily lows near 120.40 ahead of data

• EUR/JPY loses momentum near 120.40.
• Weekly upside capped around the 121.00 handle.
• US Payrolls coming up next on the docket.

The selling mood around the single currency coupled with the renewed demand for the Japanese yen are dragging EUR/JPY to daily lows in the 120.40 area.

EUR/JPY focused on US calendar

The cross appears to have resumed the downside on Friday following two consecutive daily advances and Monday’s rejection from the key 121.00 neighbourhood, which remains a tough barrier ahead of the resistance area in the mid-121.00s.

In fact, sellers have now regained control and are weighing on the sentiment surrounding the single currency, all against the backdrop of the moderate recovery in the greenback.

In the meantime, the Japanese safe-haven continues to gather steam in tandem with declining US yields.

Earlier in the session, German Industrial Production contracted at a monthly 1.7% during October, coming in short of forecasts. Later in the NA session, investors will closely follow another monthly report of the US labour market. Consensus expects the economy to have added more than 180K jobs during last month and the jobless rate to remain unchanged at 3.6%.

EUR/JPY relevant levels

At the moment the cross is losing 0.26% at 120.45 and a breach of 120.09 (monthly low Dec.4) would expose 119.77 (55-day SMA) and finally 119.65 (low Nov.25). On the flip side, the next up barrier is located at 121.01 (monthly high Dec.2) seconded by 121.46 (200-day SMA) and then 121.47 (monthly high Oct.31).