EUR/JPY has seen quite volatile trading since the beginning of the week. As per the market flow, the price is heading downwards. Today JPY is broadly stronger thanks to the upbeat trade balance report that registered a surplus of 0.68T while the expected number was 0.55T. On the other hand, the current account data from the eurozone is also going to be published today. The previous report showed the balance of 31.0B and forecasts call for an increase to 29.3B. Additionally, the report on German Bond Auction is also due to be revealed which previously was at 0.25/1.3. After the eurozone current account and Bond Auction reports see the light, the pair may experience some more volatility. However, JPY is expected to have greater strength over EUR even if the news from the eurozone come positive.
Now let us look at the technical picture. After the major bullish rejection yesterday, the price has broken below the support of 120.50. If the price remains below this level at a daily close today, further decline towards 119.50-30 is expected.
