- Euro after correcting lower towards the 130.80 support area against the Japanese Yen found support for a move back higher.
- There are a couple of important bullish trend lines formed on the hourly chart, which may act as a barrier for sellers if the pair moves down from the current levels.
- Euro Area Manufacturing Purchasing Managers Index (PMI) reported by the Markit Economics posted a reading of 52.3 in Jan 2016, just as the market expected.
- If the market sentiment stays bullish, then the EURJPY pair may move further higher.
The Euro declined towards the 130.80 support area against the Japanese Yen where it found buyers. The EURJPY pair found support around the stated level and started to move back higher. There are a couple of important bullish trend lines formed on the hourly chart, which may be seen as a support on the downside along with the 50 hourly simple moving average.
If the pair succeeds in breaking the 61.8% Fib retracement level of the last drop from the 132.25 high to 130.82 low, then a move towards the 132.00 area is possible.
The hourly RSI is above the 50 level, which is a positive sign for bulls moving ahead.
Euro Area Manufacturing PMI
In the Euro Area today, the Manufacturing Purchasing Managers Index (PMI) that evaluates business conditions in the manufacturing sector was published by the Markit Economics. The market was expecting no change in the PMI from 52.3 in January 2015. The outcome was as expected, as there was no change in the PMI and it came in at 52.3.
The German Manufacturing Purchasing Managers Index (PMI) was also released, which posted an increase from the last reading of 52.1 to 52.3 in Jan 2016.
Overall, it looks like the EURJPY pair may head towards the 132.00 resistance area moving ahead where sellers might appear.