FxWirePro: EUR/JPY slips lower, euro under pressure ahead of German and Eurozone preliminary PMIs

EUR/JPY chart - Trading View 

EUR/JPY is extending downside on the day, trades 0.13% lower at 120.53 at 04:30 GMT.

The single currency under pressure ahead of German and Eurozone preliminary PMIs.

The preliminary German PMI (due 07:30 GMT) is expected to show the manufacturing activity contracted for the seventh straight month in July.

Analysts also expect the Eurozone PMI to remain unchanged at 47.6, i.e. in contraction territory (below 50).

Poor data could bolster the case for a European Central Bank rate cut, weighing on the euro.

For now, the ECB is expected to stay pat on Thursday, with a strong dovish signal, setting the stage for a rate cut in September.

EUR/JPY trades with a strong bearish bias, scope for weakness till 119.80 (trendline support).

5-DMA is immediate resistance at 120.79. Bearish invalidation only above daily cloud.

Support levels - 120.40 (Lower BB), 119.80 (trendline support), 118.82 (Dec 2018 low)

Resistance levels - 120.79 (5-DMA), 121.42 (21-EMA), 121.93 (50-DMA)

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.