EUR/JPY: headed for a break below key 128.94?

Currently, EUR/JPY is trading at 128.97, down -0.54% on the day, having posted a daily high at 129.74 and low at 128.55.

EUR/JPY has suffered a resurgence of the yen and despite German employment hitting a record. EZ July inflation final came in for mm -0.6% vs 0% prior and forecast -0.5% while final readings for yy arrived at 1.3% vs 1.3% and in line with 1.3% expected.

The Yen strengthened as large and unprofitable speculative JPY shorts were covered, although there are still many risks to warrant an unwind, including N Korea, Trump woes and the Fed's inflation worry. However, US stocks are not performing well and that will keep yen strength underpinned. The latest concerns are the terror attacks on Las Ramblas, Barcelona.

At least 13 dead in van crash in Barcelona - LiveSquawk

EUR/JPY levels

Analysts at Commerzbank explained that EUR/JPY’s recent short term bounce seems to have come to an Resistance line is at 130.11 end at 130.39 and may now slip back towards its recent low at 128.04. "Provided that rallies stay below the 130.39 August 16 high on a daily chart closing basis the cross will remain directly offered. Below 128.00 we look for slippage to the previous May high at 125.80. Where are we wrong near term? Initial resistance at 130.39 (August 16 high) guards the recent high at 131.40. Only above here would reintroduce the 134.32/61.8% of the move down from 2014," argued the analysts.