EUR/JPY: BNP believes that current price level constitutes an attractive buy opportunity

In a note published this morning, BNP Paribas believes that the EUR/JPY pair currently offers a second chance to buy:

"This week, the EUR/JPY tested its 12-month trough near 122, and we believe that this threshold represents an attractive buying opportunity.

We therefore maintain our long exposure on the EUR/JPY, with an initial target at 127, and eventually a 1-year tareget at 131.

The dominant theme in the forex so far in 2016 has been the strengthening of the dollar, with the beginning of a monetary tightening cycle from the Fed, but we don't think the Fed will increase rates further this year.

In the end, even if buying USD/JPY and EUR/JPY both seem like good ideas at current prices, the EUR/JPY has the advantage of not being subject to fluctuations caused by Fed expectations."