The EUR/JPY currency pair appreciated for a second consecutive day, trading around 185.80 during Asian hours on Tuesday, June 25, 2024, after rebounding from the bottom of its ascending channel pattern. Technical analysis indicates the cross remains in a bullish trend, holding above both the nine-day and 50-day Exponential Moving Averages (EMAs), with the 14-day Relative Strength Index (RSI) at 59.45, suggesting firm but not overstretched upside momentum [1].
The pair is positioned to potentially test the upper boundary of the ascending channel near 187.70, with the all-time high of 187.95, set on April 17, as a further target. On the downside, immediate support lies at the lower boundary of the channel around 185.50, followed by the nine-day EMA at 185.07 and the 50-day EMA at 184.70. A break below this support zone could trigger a bearish reversal, possibly pushing the cross toward its nine-month low of 179.37, recorded on August 3 [1].
Strategists at Scotiabank note a shift in market narrative regarding the Japanese Yen, with attention moving away from the risk of official intervention that dominated earlier in the summer. Market participants are now focusing more on fundamental factors ahead of the Bank of Japan's policy meeting scheduled for September 18, which is increasingly influencing JPY positioning [1].
According to a currency heat map, the Euro was the strongest against the Japanese Yen among major currencies today, with the EUR/JPY pair showing a 0.03% gain. This relative strength underscores the bullish momentum in the cross [1].
CONCLUSION
EUR/JPY continues to display bullish momentum, supported by technical indicators and a shift in market focus toward Bank of Japan fundamentals. The pair's strength against the Yen highlights positive sentiment, with traders eyeing key resistance and support levels ahead of the BoJ's September meeting.