The currency pair increased and tries to stay in the green territory on the short term, but remains to see what will happen because a Nikkei’s retreat will send the Yen higher. Price continues to maintain a bullish perspective on the short term despite the minor drop, is still located above some important support level.

EUR/JPY has developed a Rising Wedge pattern on the Daily chart, but this still needs confirmation. Right now is very important to see what will happen on the Nikkei, which has reached two important dynamic resistance levels today.

The Yen dropped in the morning, even if the Japanese Current Account was reported at 2.27T, much above the 1.98T estimate and above the 2.03T in the former reading period. The EUR/JPY started to lose altitude after the Economic Watchers Sentiment was released, the indicator has increased unexpectedly, it was reported at 51.3 points, much above the 49.9 estimate and versus the 49.7 points in the former reading period, signaling optimism.

On the other hand, the Euro wasn’t impressed by the Euro-zone data, the German Trade Balance increased from 19.3B to 21.6B, beating the 19.8B estimate, while the Italian Industrial Production rose by 1.2%, beating the 0.1% estimate and the 0.1% growth in the former reading period. The Euro has taken a hit from the French Industrial Production, which has dropped by 0.3% in August, even if the traders have expected to see a 0.4% growth.

Price increased, but failed to stay above the outside sliding line (SL) of the ascending pitchfork. It maintains a bullish perspective as long as is trading above the downside line of the potential Rising Wedge pattern. A valid breakdown from the mentioned chart pattern will confirm a further drop even if we have a strong support at the upper median line (UML) of the major ascending pitchfork.

This scenario will take shape only if the Nikkei stock index will start a minor correction after the impressive rally.