EUR/JPY Exchange Rate Update
The euro/yen cross dropped to about 179.70 during early European trading on Tuesday. After reaching a record high recently, it has pulled back somewhat. Still, the ongoing decline of the Japanese Yen (JPY) suggests that further losses may be somewhat limited for the cross.
In response to the shifting economic landscape, Japanese Prime Minister Sanae Takaichi has called on the Bank of Japan (BOJ) to maintain low interest rates. She emphasized that monetary policy should aim to foster robust economic growth while ensuring stable price increases.
From a technical perspective, the outlook for EUR/JPY appears quite favorable. The price remains well-supported above the crucial 100-day exponential moving average (EMA) on the daily chart. Moreover, the 14-day relative strength index is above the midline, currently sitting at around 65.95, indicating that further gains may be on the horizon in the short term.
A critical resistance level for the cross is positioned at the psychological point of 180.00. If trading stays above this threshold, the pair might gather momentum to reach the upper Bollinger Bands at 180.20. Should it continue to rise, the next significant barrier is likely to be around 181.00.
On the flip side, the initial support level for EUR/JPY is noted at the October 31st high of 178.56. If it falls below this mark, it could drop to the low of November 6th at 176.28. Additionally, a noteworthy downside filter to keep an eye on is the lower boundary of the Bollinger Bands, located at 175.80.
