EUR/JPY has been quite bullish but very volatile in nature recently after bouncing off from 128.50. EUR has been quite mixed with the economic reports today which is clearly reflected in the charts as well. Today EUR French Flash Manufacturing PMI report was published with an increase to 55.8 from the previous figure of 54.9 which was expected to decrease to 54.5, French Flash Services PMI decreased to 55.5 from the previous figure of 56.0 which was expected to be at 55.9, German Flash Manufacturing PMI report was published with an increase to 59.4 from the previous figure of 58.1 which was expected to decrease to 57.7, German Flash Services PMI was published as expected at 53.4 which previously was at 53.1, EUR Flash Manufacturing PMI showed increase to 57.4 from the previous figure of 56.6 which was expected to be at 56.3 and EUR Flash Services PMI decrease to 54.9 from the previous figure of 55.4 which was expected to be unchanged. By observing the reports, we can come to a conclusion that EUR has been quite positive with the Manufacturing PMI whereas Services PMI was found worse than expected in every case. Moreover, ECB President Draghi was quite neutral about short term interest rates and future monetary policies which lead to minimum impact in the market during the event. On the JPY side, today Flash Manufacturing PMI report was published which showed an increase to 52.8 from the previous figure of 52.1 which was expected to be at 52.3. The positive report did help JPY to gain some momentum but that could not sustain much further which as a result signals that EUR is quite stronger than JPY and further gain on EUR side is very probable.
Now let us look at the technical view, the price is currently residing above the support level of 128.50 with some bullish momentum in place. The price has been quite corrective and volatile for last few days and found rejecting off the 128.50 level for several times which explains the bullish presence in the market. As the price remains above the 128.50 with a daily close further bullish move towards 130.60 is expected in the future. On the other hand, if price breaks below 128.50 with a daily close then we will be looking forward to selling with a target towards 125.80 support level.
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