EUR/JPY is trading in the red and look too heavy to be stopped on the short term. Has managed to drop below the 128.04 previous low confirming a further drop in the upcoming period. The Yen appreciates versus all its rivals as the Nikkei plunged aggressively in the yesterday’s trading session.
The Nikkie failed to stabilize above the 19700 major static resistance (support turned into resistance) and now is approaching the 19309 previous low. Technically, the index was expected to drop towards the 18936 static support, such a drop will force the Yen to dominate the currency market.
Euro posted humble gains right after the German PPI was released, the indicator increased by 0.2% in July, beating the 0.0% estimate and the 0.0% growth in the former reading. The Euro-zone Current Account could bring more action, is expected to decrease from 30.1B to 27.3B in June.
Has finally dropped below the 128.00 psychological level and seems poised for more drops. It is located below the median line (ml) of the minor descending pitchfork and much below the 38.2% retracement level, the next downside target will be at the 50% Fibonacci line (ascending dotted line). The further drop will be confirmed after a retest of the broken median line (ml).
The breakdown needs confirmation to be sure that will extend the sell-off, technically is expected to drop further after the retest of the red uptrend line and the upper median line (UML) of the ascending pitchfork.
