The EUR/JPY pair had been in a longer corrective structure since the hike towards 122.80 area. For the whole January there was no dominating side in this pair where the price was corrective between 122.80 to 120.50 area. Yesterday German Factory orders were better than expected with 5.2% which was expected 0.6%. Data on Retail PMI and SENTIX Investor confidence was also better than the forecast. After all the positive events for EUR it has failed to show some advantages over JPY and had drastic fall below 122.80. Today with some positive events for EUR, such as French Trade Balance which was -3.4B, which was better than expected -4.2B and still EUR has failed to provide some bullish pressure against JPY. At the same time JPY has not have any high-impact news to prove power against EUR.
Now let us look at the technical view, after a longer corrective period since the beginning of January, the price has broken below the support area of 120.55-85 area. Currently the price is showing some bullish evidence to reach 120.55-85 as new resistance and if we see any bullish rejection from the area we will be looking forward to sell with a target towards 118.50 as the next support level.
