EUR/JPY Price Forecast: Rises to near 186.00 as bullish bias prevails

EUR/JPY continues to rise on the second consecutive day, trading close to 186.00 during the Asian session on Friday. Technical analysis of a daily chart indicates the spot is moving upward within an ascending channel pattern, suggesting a sustained bullish bias. The EUR/JPY cross maintains a bullish near-term outlook as it remains above both the nine-period and 50-period Exponential Moving Averages (EMAs).

The 14-day Relative Strength Index (RSI) at around 60.85 implies a constructive upside momentum, without being overbought. The main resistance can be found at the upper edge of the ascending channel near 187.00. A successful break above the channel would reinforce the bullish bias, enabling the currency pair to target its record high of 187.95, achieved on April 17.

Conversely, EUR/JPY could encounter primary support near the nine-day EMA at 184.79, followed by the 50-day EMA at 184.64 and the lower edge of the ascending channel at 184.70. A breach below this support cluster could resurrect the bearish bias, possibly dragging the currency cross towards its nine-month low of 179.37, observed on August 3.

Commerzbank’s FX Research team emphasizes the influence of the latest US Treasury announcement on the rates complex, mentioning that from 9 September, "the US Treasury will double the size of liquidity support buyback operations to at least USD4bn." The news had an immediate impact on the long end of the curve, as the 30Y yield fell by 10 basis points and the curve flattened, reinforcing the bull-flattening trend that has contributed to recent Dollar weakness and Yen strength.