The EUR/JPY closed at 135.16 yen per euro on Thursday, up 0.27% from the previous close, after Japan's Cabinet Office said that core machinery orders, excluding those from electric power companies and those for ships, tumbled 5.7% month-on-month in August to 579.4 billion yen, missing the forecast of a 2.7% increase. Machinery orders, which are widely regarded as a leading indicator of corporate capital investment, have been on the decline for a third straight month.

The global financial firm Markit, said in late September that the flash Nikkei Manufacturing PMI for Japan came in at 50.9 for September, down from 51.7 in August, the lowest in three months. The Nikkei Japan PMI reading fell short of the median analysts' forecast of 51.2. A reading above 50 indicates expansion in the sector while a reading below 50 shows contraction.

Japanese Prime Minister Shinzo Abe, who was officially appointed to another three-year term as leader of the Liberal Democratic Party in late September, announced three new pillars of his “Abenomics” policy including an expansion of Japan nominal gross domestic product to 600 trillion yen, from nearly 500 trillion yen in fiscal 2014, though he didn’t elaborate how or when that growth would be achieved.

The Federal Statistical Office said on Thursday that German exports dived 5.2% to 97.7 billion euros month-on-month, the steepest decline since January 2009. Imports tumbled by 3.1% to 78.2 billion euros, the biggest one-month decline since November 2012. Germany's trade surplus narrowed to 19.6 billion euros. Economists polled by Reuters had been expecting declines both in exports and imports of about 1.2% and a trade surplus of 22.5 billion euros.

ECB Executive Board member Sabine Lautenschlaeger, former Bundesbank vice president, told Bloomberg on Friday that it is really premature to discuss more QE. She also hinted that a decision about whether and how to adjust the ECB’s 1.1 trillion-euro bond-buying program may not be on the table when the ECB Governing Council meets in Malta on October 22.

European Central Bank (ECB) President Mario Draghi said in late September at the last ECB meeting in Frankfurt, that the bank is prepared to beef up its bond-buying program if inflation weakens more than currently expected. Mr. Draghi also said that “if needed,” the program could “go beyond” September 2016.

Minutes of the U.S. Federal Reserve’s September 16-17 policy meeting, released on Thursday, didn’t help much either as it showed that Fed officials were actually concerned about low inflation and economic problems in China. The federal funds futures, commonly used to estimate the market’s views on the likelihood of changes in U.S. monetary policy, indicate only 8% odds for a quarter-point rate hike at the October 28 policy meeting, while the odds are 37% at the December 16 meeting, according to data from CME Group as of October 9.

While the euro continues to rise against the U.S. dollar as the Federal Reserve delays a rate hike, the Japanese yen is being supported as a safe-haven against other major currencies during the turmoil in the global financial markets. 

From our technical viewpoint, the EUR/JPY could be moving in the symmetrical triangle chart patterns for awhile as currency traders can’t decide which EUR or JPY will turn bullish next. The currency pair just broke out the 200-day SMA (red line) which is running in parallel to the upper trendline resistance of the symmetrical triangle, but is stuck under the 100-day SMA (blue line) which is running in parallel to the 23.6% Fibonacci retracement. There are several head resistances between the 23.6% Fibonacci retracement and the 138.9 level, and hence a breakout is unlikely.