Key Highlights
- The Euro recently recovered towards 129.00 against the Japanese Yen, but failed to gain momentum.
- There are two important bearish trend lines preventing further upsides near 129.00 on the 4-hours chart of EUR/JPY.
- Germany’s preliminary Manufacturing PMI for August 2017 posted a rise from 58.1 to 59.4.
- Euro Zone’s preliminary Manufacturing PMI for August 2017 posted a rise from 56.6 to 57.4.
EUR/JPY Technical Analysis
The Euro after consolidating near 128.00 against the Japanese Yen corrected higher. However, the EUR/JPY pair struggled near 129.00 and could decline back towards 128.00.
There is a major resistance zone forming near 129.00-129.10. There are two important bearish trend lines preventing an upside break near 129.00 on the 4-hours chart.
Furthermore, the 50% Fib retracement level of the last decline from the 130.39 high to 127.55 low is also at 128.97. The pair already struggled near 129.10 two times and currently following a bearish path.
On the downside, the 128.00 level is a crucial support zone. If the pair moves down from the current levels buyers might take a stand near 128.00.
To sum up, it seems like the pair might consolidate in the 128-129 range for some time before making the next move.
Euro Zone and Germany’s Manufacturing PMI
Today in the Euro Zone, the preliminary readings of the Manufacturing Purchasing Managers Index (PMI) for August 2017 were released by the Markit economics.
The market was looking for Germany’s preliminary Manufacturing PMI for August 2017 to decline from 58.1 to 57.7. However, the end result was positive, as there was a rise from 58.1 to 59.4.
The Euro preliminary Manufacturing PMI for August 2017 was forecasted to decline from 56.6 to 56.3. Again, the end result was positive, as there was an increase from 58.1 to 57.4.
The report added that:
The manufacturing sector performed strongly, with both output and new orders rising at sharper rates in August. The latter was boosted by the fastest rise in exports for six-and-a-half years. The service sector, on the other hand, saw growth of activity ease to a seven-month low.
The outcome was positive, and may lift EUR/USD and EUR/JPY. However, it won’t be easy for buyers to break 129.00.
