EUR/JPY weakens to 130.38/43 after EMU PMI

FXstreet.com (Barcelona) - The EUR/JPY weakened substantially overnight, surrendering its grip on the 131.00 level Wednesday, however this proved to only be the beginning of the decline.

According to the Technical Analyst Team at ICN.com, “The EUR/JPY failed at the descending resistance, currently approaching the bottom of the range near 130.00 level. Clear stability below 130.00 is needed to confirm another leg lower, and thus we remain neutral for now.”

European trading has seen the release of economic data out of the EMU – Markit Services PMI came in at 47.2 in May, missing expectations of 47.5. Moreover, the Markit PMI Composite recorded 47.7, matching its projections in May. Finally, in Germany, the Markit Services PMI yielded a figure of 49.7, vs. estimates calling for 49.8.

At the time of writing, the EUR/JPY has now fallen back below the 130.38/43 level, trading negatively at -0.36% during European trading. Given the recent performance of the pair, Mataf.net analysts point to the next level of supportive correction for the EUR/JPY at 130.16, then 129.30, and finally 128.68. On the ascension, resistive structures will activate at 131.64, onto 132.26, and finally 133.12.