EUR/JPY recovers to 115.00 handle ahead of EU CPI

After facing rejection at 116.00 handle on Wednesday, the EUR/JPY cross dropped to 114.64 level on Thursday before recovering some lost ground to currently trade around 115.00 psychological mark.

A fresh wave of global risk-aversion boosted the safe-haven appeal of the Japanese Yen and exerted selling pressure around the cross during Asian session. A slight improvement in investor risk appetite, as depicted by a recovery in the USD/JPY major, helped the cross to trim early losses.

Additional recovery, however, was restricted and the pair continued trading in negative territory as markets now await for the release of final Euro-zone CPI print for August. Today's BOE monetary policy decision is likely to infuse volatility in the FX market and eventually provide some impetus for the pair. However, key determinant of the pair's near-term direction would be next week's BOJ monetary policy decision. 

Technical levels to watch

From current levels 115.25-30 area seems to act as immediate resistance, which if cleared seems to boost the pair back towards 116.00 handle before the pair darts towards monthly high level resistance near 116.37. On the flip side, weakness back below 115.00 handle is likely to find support near 114.65 level (session low) below which the slide could get extended towards 114.40 intermediate support en-route 114.00 round figure mark support.