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EUR/JPY minor recovery headed for failure yet again?

FXStreet (Guatemala) - EUR/JPY is currently trading at 134.93 with a high of 135.12 and a low of 134.65.

EUR/JPY is recovering on the daily sticks and is up to the test the vicinity of the 200 DMA at 135.08 having already penetrated this target area once in today's session as risk sentiment is cautiously back into play. There was a recovery in share prices in the European sessions and a mixed feel on Wall Street, but the Nikkei has opened in the green and has been making tracks while the S&P futures are also trading positively.

China will be out as of tomorrow for a week and this may allow a continuation of a recovery, although Nonfarm Payrolls is looming and poses a risk to equities if the number is strong and sentiment tips to a higher percentage balance in favour of a rate hike from the Fed as soon as the same month.

EUR/JPY risks from EZ data

Tomorrow brings CPI's for the EZ first, "EurozoneSep CPI is expected to print flat after rising 0.2%y/y in Aug though core should remain at 0.9%y/y. German Sep inflation, which we saw yesterday, was lower than expected," explained analyst at Westpac Banking Corporation.

EUR/JPY double top emerging?

Technically, despite the advance to the 200 DMA, failures here again will be a double top and the downside will come back into vogue. "We still view the market as having topped and look for a slide back to the 132.24/131.80 recent low and 61.8% retracement," explained Karen Jones, chief analyst at Commerzbank. "Initial support is the uptrend at 133.26."

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