EUR/JPY has been quite corrective and volatile above 129.50 area which indicates the bearish pressure persists in the current market situation. Though JPY has been quite weak with the recent fundamentals providing no hint for further gains, EUR is also struggling for gains as well.
Recently, Japan’s economic reports were published with mixed results, including BSI Manufacturing Index decreasing to -3.2 from the previous positive value of 2.9 which was expected to increase to 3.2 and PPI report was published with an increase to 2.7% which was expected to be unchanged at 2.1%. Moreover, Tertiary Industry Activity also showed a surge to 1.0% from the previous negative value of -0.3% which was expected to be at 0.6%. Ahead of the upcoming BOJ Policy Rate and Policy Statement this week, JPY is expected to gain certain momentum over EUR if Japan manages to provide upbeat economic reports consistently in the coming days.
On the other hand, today the eurozone’s Employment Change report is going to be published which is expected to be unchanged at 0.3% and Industrial Production report is expected to decrease to -0.6% from the previous value of 0.5%. Though forecasts are quite dovish at the moment for EUR, certain gains against EUR can be observed ahead of the ECB Press Conference to be held tomorrow.
As for the current scenario, certain volatility and correction is likely to persist in the pair in the coming days which may lead to certain indecision and indefinite pressure in the pair. Though JPY is expected to have an upper hand, recent eurozone’s economic reports signal a further struggle of the currency in the future.
Now let us look at the technical view. The price is currently a bit bullish after the severe bullish rejection based daily candle closed yesterday above 129.50 area. Currently the price is to push lower towards 124.50 support area as it remains below 131.50 area. So, the bearish bias is expected to continue further in the coming days.