FxWirePro: EUR/JPY capped at 20-DMA, focus on German Retail Sales and Eurozone inflation data for impetus

EUR/JPY chart - Trading View 

EUR/JPY was trading 0.15% lower on the day at 123.83 at around 04:20 GMT, outlook remains bullish.

The pair has slipped lower from session highs at 124.25, as 20-DMA offers stiff resistance at 124.30.

Data released on Tuesday showed German headline inflation slipped into negative territory again in September. On a year-on-year basis, inflation fell to -0.2 percent from 0.0 percent in September.

Meanwhile, core inflation rate is expected to have eased to 0.6 percent from 0.8 percent, based on the results of the state statistical offices.

Technical studies support further gains in the pair. 5-DMA has turned and MACD is on verge of bullish crossover on signal line.

Market sentiment seesaws as the first round of US presidential debate begins. Focus shall be on German Retail Sales and Eurozone inflation data for impetus.

We expect the euro zone inflation rate to fall slightly to -0.3 percent (August: -0.2 percent). The core inflation rate should remain unchanged at 0.4 percent”, said Commerzbank in a report.

Support levels - 123.31 (5-DMA), 122.78 (110-EMA), 122.11 (Lower BB)

Resistance levels - 124.30 (20-DMA), 124.78 (50-DMA), 125.15 (200W MA)

Summary: Major trend as evidenced by the GMMA is bullish. Watch out for decisive break above 20-DMA to enter long position. On the flipside, retrace below 110-EMA negates any bullish bias.