EUR/JPY Price Forecast: Bulls eye 185.00 resistance area
- EUR/JPY crawls above 184.50 with the Yen weighed down by downbeat Japanese GDP data.
- Japanese economy grew at a 0.3% pace in Q2, from 0.5% in the first three months of the year.
- The sluggish domestic demand might reactivate Japan's fiscal concerns, according to BBH experts.
The Euro (EUR) crawls higher for the third consecutive day on Monday, against a weak Yen (JPY), weighed down by downbeat Japanese Gross Domestic Product (GDP) figures. The EUR/JPY pair confirmed the breach of the 50% retracement of the late July sell-off, trading at the 184.50 area at the time of writing, with the resistance area around 185.00 coming closer.
The Japanese Cabinet Office revealed earlier on Monday that the country’s economic growth slowed down to 0.3% in the second quarter, against the market consensus of a steady 0.5% reading. Year-on-year, the Japanese economy decelerated to a 1.1% growth, from 1.8% in the previous quarter, instead of the 2.0% rise anticipated by market analysts.
Economists at Brown Brothers Harriman note that Japan’s latest activity data underscores a softer growth pulse than markets had anticipated. BBH highlights that “private consumption was flat, while private non-residential investment shaved -0.2ppt off growth.” “The sluggish domestic demand activity will do little to ease Japan’s fiscal concerns, a major headwind for JPY.” Said the BBH experts in a note.
Technical Analysts: In a bullish trend, aiming for the 185.00 area
EUR/JPY trades at 184.54, with price action holding comfortably above an ascending trendline from late July lows, and momentum indicators reflecting growing upside traction. The daily Relative Strength Index (RSI) around 52 signals neutral-to-positive momentum, and the Moving Average Convergence Divergence (MACD) has turned increasingly positive, hinting that bullish pressure is rebuilding after a consolidating phase last week.
Bulls are likely to meet significant resistance at the area between the 61.8% Fibonacci retracement of July's decline, at 184.82, and the July 31 high, at 185.17. Beyond here, the next upside target is the July 27 and 28 lows and the 78.2% Fibonacci retracement, near 186.00
On the downside, immediate support is seen at the confluence of the 200-day SMA and the 50% retracement of the previously mentioned decline, just under 184.00. If these levels are broken, the focus will shift towards the Fibonacci cushions at 183.15, which held bears on August 12.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.17% | -0.16% | -0.03% | -0.09% | -0.59% | -0.45% | -0.38% | |
| EUR | 0.17% | -0.01% | 0.13% | 0.07% | -0.39% | -0.25% | -0.21% | |
| GBP | 0.16% | 0.00% | 0.13% | 0.07% | -0.37% | -0.27% | -0.20% | |
| JPY | 0.03% | -0.13% | -0.13% | -0.05% | -0.54% | -0.40% | -0.32% | |
| CAD | 0.09% | -0.07% | -0.07% | 0.05% | -0.49% | -0.36% | -0.29% | |
| AUD | 0.59% | 0.39% | 0.37% | 0.54% | 0.49% | 0.13% | 0.15% | |
| NZD | 0.45% | 0.25% | 0.27% | 0.40% | 0.36% | -0.13% | 0.07% | |
| CHF | 0.38% | 0.21% | 0.20% | 0.32% | 0.29% | -0.15% | -0.07% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
