Snapshot: EUR/JPY trades heavy under the 170.00 handle, pressured by yesterday’s ECB wage tracker which confirmed stable negotiated wage growth and solidified the case for further easing. This domestic drag is compounded by acute Bank of Japan intervention risk as the yen tests levels that historically trigger MoF action. Risk-off undertones, led by a 12.37% jump in the VIX to 18.44, provide secondary headwinds for the cross.
- Key Level: Sustained trading below 169.50 exposes the 168.00 support level, with the ECB’s core HICP at 2.3% offering little fundamental defense for Euro bulls.
- NY Watch-Item: Verbal intervention from Tokyo is the primary risk during NY hours, as any sudden MoF dollar-selling will trigger immediate, aggressive unwind of EUR/JPY longs.
Bias into NY: We are tactically short EUR/JPY targeting 168.50, as the combination of a dovish ECB stance and rising global risk aversion caps any upward momentum.