Omicron Pulls EUR/JPY Back

Appetite for safe-haven assets has picked up in recent trade amid a deterioration in US shares due to retreating market sentiment.

EUR/JPY has been tilting lower and looks for direction to end the day with losses of about 0.5%. The first Omicron Covid-19 infection has identified in America and, shares reacted immediately as the S&P 500 is now down over 0.5% on the day having been nearly 2.0% higher in pre-market trade.

EUR/JPY dropped from earlier session highs above 128.50 back to just above weekly lows at 127.50. When it topped out earlier in the session above 128.50, EUR/JPY seemed to find resistance at a long-term downtrend that has been capping the price action since early November.

If support around 127.50 does go, the pair would slip to its lowest levels since February, which could pave the way to a run lower towards 125.00, the next area of significant support.