EUR/JPY drops more than 30 pips on ECB´s comments

• Euro dropped more than 30 pips on ECB spokesman denying earlier comments by ECB’s Nowotny.   
• Euro got lifted on hawkish ECB Nowotny’s comments earlier in the European session.

The EUR/JPY is trading at 132.38  up around 0.64% on Tuesday as the pair is mainly driven by market sentiment and comments from ECB’s members.   

The euro got a boost earlier in the day when ECB’s E. Nowotny made hawkish comments and said that the “European Central Bank will stop buying assets at some point this year.” However, towards the end of the European session, an ECB spokesman said: “Nowotny's views are his own and don't represent the view of the governing council.” The EUR/JPY cross and EUR/USD dropped more than 30 pips on the news.

The yen is relatively weak as the market is in risk-on mode after China’s President encouraging comments at the Boao forum. He said he planned to open up the Chinese economy and push for free trade.

EUR/JPY weekly chart

The EUR/JPY on the weekly chart is trading above its 50, 100 and 200-period simple moving averages (SMA). The 50-period SMA has crossed over the 200-period SMA creating a golden cross, giving more strength to the current 3-week bull run. 

EUR/JPY daily chart

The market is trying to close above the 132.45 swing high. The EUR/JPY broke above its 50 and 200-period simple moving averages on the daily chart. 

EUR/JPY 4-hour chart

The bulls managed to take control but they will have to break the resistances ahead of them. Resistances are seen at 132.45 and 133.07 swing highs. Supports are seen at 131.10 and 129.98 swing lows.