On Tuesday, the Japanese Yen experienced a notable rebound against its currency peers after US and Japanese authorities intervened in the foreign exchange markets to support the Yen. The EUR/JPY cross registered modest gains of 0.56%, trading around 181.90, following three consecutive days of losses. The intervention shifted EUR/JPY from a bullish to a sideways trend, with momentum indicators such as the Relative Strength Index (RSI) pointing toward further downside and nearing oversold territory. Key technical levels for bearish continuation include a break below 180.00, with subsequent support at 179.3 and 178.82. For bullish momentum to resume, EUR/JPY must reclaim 182.00 and 183.00, with the 200-day Simple Moving Average (SMA) at 183.74 acting as a major resistance point [1].
Meanwhile, the USD/CHF pair retraced by 0.16% as the US Dollar weakened amid improved risk appetite, attributed to renewed hopes of a US-Israel peace deal to open the Strait of Hormuz. USD/CHF traded below 0.8100, having broken a support trendline connecting the lows of June and mid-July. The next key support is the 50-day SMA at 0.8042, confirmed by a bearish RSI. Despite the short-term bearish outlook, the overall market structure remains constructive, with successive higher highs and higher lows indicating an intact uptrend. For further bearish movement, USD/CHF must clear the 50-day SMA and the 0.8000 mark, with additional support at the 100-day SMA (0.7957) and 200-day SMA (0.7929). Bullish momentum would require reclaiming 0.8100 and breaking through 0.8150, with resistance at 0.8200 and the yearly high at 0.8207 [2].
The Swiss Franc was the strongest currency against the Japanese Yen on Tuesday, with CHF/JPY up 0.43%. The heat map of major currencies shows CHF outperforming JPY, while USD weakened against CHF by 0.17%. These movements reflect broader currency volatility following the intervention and shifting risk sentiment in global markets [2].
Technical analysts from both articles highlight the importance of key support and resistance levels for EUR/JPY and USD/CHF, suggesting that further downside or upside will depend on whether these thresholds are breached. No explicit forward-looking statements or analyst opinions regarding future interventions or policy changes are provided in the sources.
CONCLUSION
Currency markets reacted to official intervention, with the Japanese Yen rebounding and the Swiss Franc outperforming the Yen. Technical indicators suggest continued volatility, with traders closely watching key support and resistance levels for EUR/JPY and USD/CHF. The overall market sentiment remains cautious, reflecting ongoing uncertainty and shifting risk appetite.