EUR/JPY is still residing inside the corrective range between 131.40 to 134.40 area where recently the price has been quite bullish from the middle of the range bouncing off the dynamic level. The correction in the pair does indicate the indecision in the market with the directional bias as of recent mixed economic reports of both EUR and JPY. Today JPY Core Machinery Orders report was published with an increase to 5.0% from the previous negative value of -8.1% which was expected to be at 3.1%. The positive economic report did help the currency to gain some momentum over EUR but still, no impulsive pressure is observed on the bearish side leading to more consolidation in the price action. On the EUR side, today German Final CPI report is going to be published which is expected to be unchanged at 0.3%, German WPI is expected to increase to 0.2% from the previous value of 0.0%, Italian Industrial Production report is expected to increase to 0.7% from the previous negative value of -1.3%, Employment Change is expected to be unchanged at 0.4% and Industrial Production is expected to increase to 0.0% from the previous negative value of -0.6%. As of the current scenario, EUR is expected to have some better economic reports today which might lead to further gain on the EUR side over JPY but until any high impact economic reports of EUR and JPY comes in to support the upcoming directional pressure, the pair is expected to be indecisive for the time being.
Now let us look at the technical view, the price is currently residing above the dynamic level of 20 EMA having a daily rejection off the level. The price is currently residing in the middle of the range and above 20 EMA which does signal the bullish move is quite imminent which will push the price towards 134.40 area in the coming days. On the other hand, as the price residing in a corrective range, if the price breaks below the dynamic level of 20 EMA with a daily close we might see the price heading down towards 131.40 support area and later towards 128.00 support area in the coming days.
