EUR/JPY rebounds after hitting 2-month lows

• Euro rebounds after trading below a critical level. 
• Yen losses strength amid a recovery in Wall Street and rising US bond yields. 

The euro trimmed losses against the yen during the American session. The EUR/JPY pair bottomed earlier at 131.38, the lowest since mid-September and near the end of the day is approaching 132.00. 

Euro resilient, yen losses momentum 

The yen was the best performer in the market until the beginning of the US session when it changed its daily trend. A recovery in equity prices in Wall Street and a slide in Treasuries weakened the yen. After holding most of the day in negative territory, the Dow Jones was up 0.05%. The 10-year yield rose from 2.30% to 2.32%. The euro remained resilient and received some support from the rally in EUR/GBP. 

Technical levels 

EUR/JPY is still down for the day, but it has risen more than 50 pip from the lows. Again the pair appears to be able to avoid closing under 131.80 that would be a negative technical signal for the euro and the lowest close since September 14. 

The daily chart still shows the pair near the 131.50/80 area. It continues to face bearish pressure but climbed back to the range 133.00/131.80. 

A the moment, it trades at 131.95 and it faces resistance at 132.00, 132.35/40 (Nov 7 high) and 132.85 (Oct 3 & 5 high). On the flip side, support might be seen at 131.35/40 (daily low), 131.10 (Aug 7 high) and 130.90 (20-week moving average).