EUR / JPY offered, flirts with the 200-day SMA above 129.00

• EUR / JPY rises even higher and challenges the 200-day SMA.
• The German business climate disappointed the August estimates.
• Durable goods orders from the US contracted less than expected in July.

Selling pressure surrounding the Japanese yen helps the EUR/JPY to regain the 129.00 zone on Wednesday.

EUR / JPY remains positive ahead of Jackson Hole

EUR / JPY is advancing for the fourth consecutive session and is further away from last week’s lows at levels below 128.00.

In fact, the cross now manages to return to the key zone around 129.00, where the critical 200-day SMA, the 20-day SMA and the 2021 line coincide.

Meanwhile, decent dollar gains put pressure on the Japanese safe haven even as US 10-year yields continue to seek to consolidate, always below 1.30%.

On the agenda, Japan’s coincident index improved to 94.1 in June (from 92.1 previously) and the leading economic index rose to 104.1 for the same period (from 102.6 previously). On the other hand, the German IFO was mixed and showed that the business climate gave some ground to 99.4 for the current month (from 100.7 previously).

In the US data space, major durable goods orders contracted 0.1% month-on-month in July, while orders excluding transportation expanded more than expected 0.7% month-on-month.

Technical levels

So far, the cross is gaining 0.17% to 129.09 and a breakout of 129.14 (August 23 weekly high) would expose 130.01 (August 5 high) and then 130.56 (July 29 weekly high). On the downside, the next support comes at 128.54 (61.8% Fibonacci from the January-June rally) followed by 127.93 (August 19 monthly low) and finally 127.02 (78.6% Fibonacci from the March-June rally).