EUR/JPY Price Forecast: Rebound stalls below 200-day SMA
The EUR/JPY buyers stop the bleeding after three consecutive days of losses, registering modest gains of 0.56% on Tuesday. At the time of writing, the cross-pair trades at around 181.90 after US and Japanese authorities intervened in the FX markets to propel the Japanese Yen against its pairs.
EUR/JPY prices have stalled below the 200-day Simple Moving Average (SMA) following a brief rebound. After three days of losses, the currency pair managed to gain 0.56% on Tuesday, trading at around 181.90. Intervention by US and Japanese authorities helped the Japanese Yen against its pairs, causing the EUR/JPY to shift from bullish to sideways trading.
Momentum suggests further downside, with the Relative Strength Index (RSI) pointing toward oversold territory. For a bearish continuation, sellers must break the 180.00 level, with the August 3 cycle low of 179.3 lying beneath. For a bullish resumption, the EUR/JPY must surpass the 182.00 and 183.00 levels, with the 200-day SMA at 183.74 sitting above these milestones.
The Japanese Yen is influenced by the performance of the Japanese economy, the Bank of Japan's policy, the differential between Japanese and US bond yields, and market sentiment. The Bank of Japan has intervened in the currency markets to lower the Yen's value, although it avoids frequent interventions due to political concerns.
The BoJ's ultra-loose monetary policy between 2013 and 2024 led to the Yen's depreciation, but the gradual unwinding of this policy has provided support to the Yen. The widening policy divergence between the Bank of Japan and other central banks, especially the US Federal Reserve, has strengthened the US Dollar against the Japanese Yen.
The Japanese Yen is often considered a safe-haven investment, which can rise in value during market stress due to its perceived reliability.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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