EUR/JPY holds above 130.00, limited by 131.00

EUR/JPY is rising modestly on Monday. It remains above 130.00 but the upside, continues to be limited below 131.00.

Rebounding from 131.00

On Friday the pair made a strong reversal, affected by the slide of the EUR/USD pair. That day, the euro rose momentarily above 131.00 against the yen, but then dropped a hundred pips from the highs.

It closed the week around 130.40 and today, rose during the European session to 130.85, the highest level. Now it's moving to the downside and trades at 130.55. Price remains within Friday's range on a quiet day for the forex market.

EUR/JPY: Between two trend-lines, still on an uptrend channel

The pair on Friday found support above 130.00 and also on top of an uptrend line, originated on July 19 lows. That line is also the lower base of an upward channel that continues to be in place and still offers support. If the euro fails to hold above 130.00, a bearish extension seems likely.

On the upside, the pair is also facing a dynamic resistance, with a line coming from August high that currently stands at 130.70. A confirmation above that area could clear the way for a test of 131.40 (August high).