EUR/JPY static around 115.00 mark after EU GDP and CPI release

The EUR/JPY cross had a muted reaction to the Euro-zone GDP and CPI releases but managed to hold on to its recovery move above 115.00 handle. 

According to the preliminary estimates, the Euro-area recorded a tepid economic growth of 0.3% in the second quarter of 2016. The reading was in-line with market expectations but was well short of 0.6% growth recorded in the previous quarter.

Meanwhile, the flash version of region's CPI print came-in at 0.2% y-o-y, slightly above 0.1% expected but still eased concerns of continuing deflationary pressure in the Euro-zone. 

The EUR/JPY cross failed to extract any benefit from upbeat economic data as the Japanese Yen maintained its strong bid tone after BOJ disappointed markets by leaving its interest rate and monetary base unchanged. Following BOJ announcement, the cross plunged below 114.00 handle (2-week low) before finding some stability around 115.00 psychological mark.

Technical levels to watch

On the immediate downside, 114.00 round figure mark remains immediate support to watch for, which if broken is likely to trigger a fresh leg of weakness for the pair that could take the pair back towards 113.00 level and subsequently to 112.50-40 strong horizontal support.

Meanwhile on the upside, 115.75-80 zone (nearing 116.00 round figure mark) seems to act as immediate resistance. Momentum above this immediate resistance is likely to get extended further towards session high resistance near 116.55-60 region and eventually towards its next major resistance near 117.65-70 region, coinciding with 50-day SMA.