Both the EUR/JPY and GBP/JPY currency pairs traded sideways on Monday, reflecting market participants' caution amid ongoing fears of intervention by Japanese authorities and heightened risk aversion due to geopolitical uncertainty in the Middle East [1][2]. The EUR/JPY pair was virtually unchanged at 185.59, with traders reluctant to push the cross higher following recent coordinated action by the US and Japan, despite Japanese authorities remaining inactive since then [1]. After a sharp drop from around 187.44 to 182.12 during the intervention, EUR/JPY rebounded near 186.00, with technical indicators such as the Relative Strength Index (RSI) showing a modestly bullish momentum since mid-August [1]. Key resistance levels for EUR/JPY are identified at 187.00, 187.50, and the yearly high of 187.95, while support lies at the 100-day SMA (185.14), 50-day SMA (184.72), and 200-day SMA (184.16) [1].
Similarly, GBP/JPY consolidated near 217.00, with price action remaining horizontal and the RSI stalling at 60 over the past two days [2]. For a bullish continuation, GBP/JPY must clear 217.00, with further resistance at 217.20-30, 218.00, and the July 30 high of 218.69 [2]. On the downside, support is seen at 216.00, the 50-day SMA at 215.68, and the 100-day SMA at 214.93 [2]. The market environment was characterized by risk aversion, with flows moving into haven assets like the US Dollar and Gold [2].
A currency heat map indicated that the Japanese Yen was the strongest against the Canadian Dollar on the day, with JPY appreciating 0.56% against itself and showing modest gains or losses against other major currencies [2]. No explicit forward-looking statements or analyst opinions were provided in the articles, but the technical outlooks suggest that further upside in both EUR/JPY and GBP/JPY is contingent on overcoming key resistance levels, while downside risks remain if support levels are breached [1][2].
CONCLUSION
Both EUR/JPY and GBP/JPY are trading in tight ranges as traders remain cautious due to intervention fears and broader risk aversion. Technical indicators point to potential bullish momentum if resistance levels are cleared, but the market remains sensitive to further developments. The overall sentiment is neutral to slightly negative, with medium market impact as participants await clearer signals.