EUR/JPY reverses ECB-led slide, fast approaching 123.00 handle

The EUR/JPY cross maintained strong bid tone for the second consecutive session and has now moved within striking distance of 123.00 handle. 

Currently trading around 122.90 region, the cross is benefiting from a sharp recovery staged by the shared currency as investors digested last week's dovish ECB tapering. Adding to this, the prevalent risk-on mood, in wake of weekend oil output deal between OPEC & non-OPEC member, is further weighing on the Japanese Yen's safe-haven demand and providing an additional boost to the pair's strong up-move on the first trading day of the week. 

Looking at the broader picture, last week's price-action could be categorized as consolidation phase following Monday's sharp recovery from the very important 200-day SMA touched in the aftermath of a 'NO' vote to Italian referendum. Hence, sustained momentum back 123.00 handle would reaffirm continuation of the pair's upward trajectory in the near-term. 

Technical levels to watch

Momentum above 123.00 handle now seems to get extended beyond last week's multi-month peak resistance near 123.35 region, towards its next hurdle near 123.75 region. On the downside, 122.00 round figure mark now becomes immediate strong support to defend, which if broken is likely to accelerate the slide towards 121.25 intermediate support before the cross eventually aims towards testing its next major support near 120.15-10 region.