EUR/JPY sellers remain in control on dollar strength, eyes for a test of 131.20 support?

Currently, EUR/JPY is trading at 131.37, down -0.35% on the day, having posted a daily high at 132.04 and low at 131.25.

EUR/JPY took a knock despite a solid day on Wall Street. The euro has suffered strong supply with the dollar rallying in the US session. Trump was steering the dollar bulls along from his Twitter account earlier in the shift around tax reforms leading to a bullish and risk-on session.

Meanwhile, eyes will be on the euro and 1.1820 is a big level to the downside that if broken, could send the cross towards below the 131 handle and en route towards the August lows around the 127.50 mark. First up, 131.20 support could be a tough area with plenty of stops below. 

OMB Director Mulvaney: Will be difficult to work with Democrats on tax reform - CNBC

More EUR/JPY technical levels

Analysts at Commerzbank explained that marginal new highs have not been sustained, but, the 55-day ma continues to hold at 129.80 currently. "We must allow for the possibility of a retest of the 132.40 resistance line," argued the analysts explaining that above 132.24/45 (August 2015 low and January 2016 high) would reintroduce the 134.32/61.8% of the move down from 2014. "A move below the 55 day moving average, is needed to alleviate upside pressure and retarget the 127.57 August low," the analysts added.