EUR/JPY trades at Y129.60 at writing,......>

EURO-YEN: EUR/JPY trades at Y129.60 at writing, having bounced from a low at

Y129.20.

- The pair rallied on Friday on the back of EU's Moscovici sounding a little

warmer re:

Italy & source reports claiming that Italy's ruling coalition sees potential for

a 2.1% deficit/GDP target (denied by the leader of 5-Star over the weekend),

although EUR remains vulnerable to the impact of political headlines.

- In Monday's early trading, the yen strengthened in sync with a lower Nikkei

255, as risk off flows centering on an Axios story which stated that President

Trump has no intention of easing his tariffs on China played out, but EUR/JPY

quickly recouped the initial decline, as Chinese stocks rallied hard at the

start of the week. The rate continues to be driven by the surrounding risk

environment.

- Bulls focus on recovering the psychological Y130.00 level ahead of challenging

the 200-DMA at Y130.66, while bears look for a break below the Sep 10 low at

Y127.87.