EUR/JPY continues its upward trajectory, trading near 171.65 during early European hours on Friday. The Japanese Yen (JPY) shows relative weakness against the Euro (EUR) as expectations diminish for a Bank of Japan (BoJ) rate hike this year, largely due to concerns over the economic impact of heightened U.S. tariffs.
From a technical standpoint, the pair maintains its bullish stance on the daily chart, holding firmly above the 100-day Exponential Moving Average (EMA). However, the 14-day Relative Strength Index (RSI) hovers around 70.50—an overbought zone—suggesting that the rally may pause or consolidate in the short term before the next leg higher.
Key resistance levels to watch include:
- 172.00 – A psychological barrier and the high from July 8
- 172.53 – The upper Bollinger Band limit
- 174.52 – A critical resistance marked by the July 3, 2024 high
On the downside, initial support lies at:
- 170.00 – A round-number support
- 169.04 – The low from July 2
- 168.10 – The low from June 25
While the bullish trend remains intact above 171.50, the overbought RSI signals potential for a short-term pullback. Traders should be cautious and watch for signs of consolidation before positioning for further upside.
