EUR/JPY subject to weakness, risks falling under 135.00

Source: Dukascopy Bank SA
© Dukascopy Bank SA
"The context is highly positive to work on long-term transformation of Europe, which would include structural reforms to improve competitiveness, but also to work on the demand side."
- McKinsey Global Institute (based on CNBC)

Pair's Outlook 
The Euro overperformed on Tuesday, as it appreciated against the Yen a lot more than anticipated. Ultimately, the EUR/JPY stabilised at 135.50, just in front of the weekly PP and 20-day SMA resistance cluster, which is expected to turn the tables around. Technical studies, however, retain their mixed signals, thus, unable to confirm the bearish scenario. Furthermore, the nearest significant support is located around 134.34, namely at the 100-day SMA, but the 135.00 major level could hold the exchange rate and prevent it from edging lower. 

Traders' Sentiment 
Bulls and bears broke out of the equilibrium, as 52% of all positions are long today. The number of buy orders inched up from 39 to 46%.
© Dukascopy Bank SA

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