EUR/JPY capped below 129.00 after rejection at 130.50 area

The euro consolidates below 129.00 supported above 128.50.
A stronger yen hampers euro recovery.
Surging Eurozone inflation adds negative pressure on the EUR.

Guillermo Alcala FXStreet

The euro has found support at 128.50 and has been trading sideways below 129.00 on Friday. The pair is consolidating after a two-day decline from a relevant resistance area at 130.50/70.

The euro fails to rebound against a stronger yen

The common currency has been unable to post a relevant recovery on Friday after having depreciated about 1.35% over the previous two days. The pair has failed to take advantage of a broad-based USD pullback, as the Japanese yen has picked up momentum on the back of softer US T-Bond yields and favoured by investors' concerns about the impasse on the US Congres regarding the debt limit.

The macroeconomic calendar has not been particularly supportive of the euro either. Eurozone inflation accelerated 3,4% year-on-year in September, from 3% in August reaching its highest level since 2008. These figures are confronting ECB’s idea of a temporary inflation spike and raising concerns about the impact on the Area’s growth prospects.

EUR/JPY moving sideways between 128.50 and 129.00

The pair seems to have found support at 128.50 after breaking support area 129.50/60. Below here, the next potential support levels might be at the 127.90/128.00 area (August 19, September 23 low) and then 127.30 (February 18 low)

On the upside, the pair should return above the mentioned 129.50/60, where the 50 and 100-day SMA lie, to ease bearish pressure and attempt to reach 130.00 before aiming to a key resistance area between 130.50 and 130.75 (September 3, 8, and 29 highs).

Technical levels to watch

EUR/JPY

Overview
Today last price	128.85
Today Daily Change	-0.06
Today Daily Change %	-0.05
Today daily open	128.91

Trends
Daily SMA20	129.54
Daily SMA50	129.52
Daily SMA100	130.79
Daily SMA200	129.73

Levels
Previous Daily High	129.96
Previous Daily Low	128.79
Previous Weekly High	129.85
Previous Weekly Low	127.93
Previous Monthly High	130.74
Previous Monthly Low	127.93
Daily Fibonacci 38.2%	129.24
Daily Fibonacci 61.8%	129.52
Daily Pivot Point S1	128.48
Daily Pivot Point S2	128.05
Daily Pivot Point S3	127.3
Daily Pivot Point R1	129.65
Daily Pivot Point R2	130.4
Daily Pivot Point R3	130.83

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

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