- EUR/JPY trades with mild gains around 165.50 in Wednesday’s early European session.
- The cross maintains a constructive view above the 100-day EMA, with a bullish RSI indicator.
- The immediate resistance level is seen at 165.65; the initial support level is located at 164.55.
The EUR/JPY cross posts modest gains near 165.50 during the early European session on Tuesday. The Japanese Yen (JPY) softens against the Euro (EUR) amid the improved risk sentiment as positive developments from US-China trade talks undermine the JPY's safe-haven status.
Technically, EUR/JPY keeps the bullish vibe on the daily chart, with the price holding above the key 100-day Exponential Moving Average (EMA). Further upside looks favorable as the 14-day Relative Strength Index (RSI) stands above the midline near 63.50. This suggests bullish momentum in the near term.
The first upside target to watch for the cross is seen at 165.65, the upper boundary of the Bollinger Band. Further north, the next hurdle is located at 166.10, the high of November 6, 2024. The additional upside filter to watch is 166.60, the high of October 30, 2024.
On the other hand, the initial support level for EUR/JPY emerges at 164.55, the low of June 9. Any follow-through selling below the mentioned level could see a drop to 162.90, the low of June 5. The key contention level to watch is 162.40, the 100-day EMA.
EUR/JPY Daily Chart
Japanese Yen FAQs
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.
Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD sticks to recovery gains above 1.1500 amid US Dollar pullback
EUR/USD holds its winning streak for the third successive day, holding firm above 1.1500 in the European session on Friday. The pair recovers as the US Dollar loses ground, possibly driven by a technical pullback and receding fears over a likely US military attack on Iran. Geopolitics remain in focus.
GBP/USD holds the rebound near 1.3500 despite weak UK Retail Sales data
GBP/USD has found demand and retakes 1.3500 in European trading on Friday. The pair seems to have ignored the downbeat UK Retail Sales data for May. Broad US Dollar weakness, amid easing Middle East tensions, keeps the major underpinned.
Gold price struggles near weekly low amid fewer Fed rate cut bets, despite Middle East tensions
Gold price is seen consolidating its intraday losses to over a one-week low and trades just below the $3,350 level during the first half of the European session. The US Federal Reserve earlier this week trimmed the outlook for rate cuts in 2026 and 2027, which is seen acting as a tailwind for the US Dollar and undermining demand for the non-yielding yellow metal.
Shiba Inu Price Forecast: SHIB demand wanes as holders offload meme tokens
Shiba Inu (SHIB) extends its decline at the time of writing on Friday after dropping nearly 5% so far this week. The on-chain data supports a correction ahead, as SHIB holders are unloading tokens amid the escalating Iran-Israel war.
In the Eurozone, inflation is also a monetary phenomenon
Monetary aggregates continue to be closely monitored by the European Central Bank (ECB), a sign that, despite the passage of time and the increasing complexity of financing circuits, quantitative theory remains relevant.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.