EURJPY is close to breaking out to the........>

FOREX: EURJPY is close to breaking out to the upside, with several key downtrend

levels from the last 6-months giving way already. The pair trades at 129.90 and

a push above 130.00 could provide the catalyst for a further move higher. The

euro's relative strength is coming in spite of the ongoing narrowing of real

yield spreads between the two countries. The 10-year real yield spread is at a

multi-year high of 80bps in Japan's favour. 

- After a strong rally over June EURKRW remains above its 100 and 200DMAs and

continues on its uptrend, currently at 1,309. However, the rally does not have

the support of real yield spreads, which have failed to rise in line with the

cross despite the 5% rally over the past month. 

- KRWJPY is showing a potential ST inverse head-and-shoulders formation with

resistance coming in at 9.970, spot ref: 9.930. Alternatively, a move below

9.850 would shift the focus lower. The rolling correlation between USDJPY and

USDKRW has turned strongly positive once again as both markets take their cues

from the greenback.