FX.co ★ EUR/JPY: upside clouded, 143.04 as key obstacle

The EUR/JPY pair continues to move somehow sideways in the short term. It has climbed as much as 143.91 today where it has found resistance. Fundamentally, the Japanese economic data came in worse than expected while the Eurozone data came in mixed.

In the early morning, Japanese Capital Spending may report a 6.4% growth, Final Manufacturing PMI could remain steady at 49.4 points, while Consumer Confidence could jump from 29.9 points to 30.0 points.

On the other hand, German Retail Sales may report a 0.6% drop, German Final Manufacturing PMI could remain at 46.7 points, Euro-zone Final Manufacturing PMI is expected at 47.3, while the Eurozone Unemployment Rate is expected at 6.6%.

EUR/JPY Downside Pressure!

Technically, the rate rebounded after finding support at 143.04. Still, the rate registered only a false breakout above 144.25 and through the weekly pivot point of 144.74.

Now, it has dropped below the 143.72 support again, this stands as the triangle's downside line. After escaping from the Rising Wedge pattern, the rate was somehow expected to drop. Technically, 143.04 represent a critical downside obstacle.

EUR/JPY Forecast!

Dropping and stabilizing below 143.04, a valid breakdown validates more declines. After its false breakout with great separation, the rate signaled exhausted buyers and strong sellers. A new lower low is seen as a short signal.