EUR/JPY Price Forecast: Trades near 178.50 after rebounding from descending channel bottom
EUR/JPY gains ground after registering losses in the previous day, trading around 178.30 during Asian hours on Monday. Technical analysis of the daily chart indicates the currency cross remains within the descending channel pattern, signalling an ongoing bearish bias.
Overnight, EUR/JPY rebounded from a decline, trading near 178.50 as it emerged from a descending channel bottom. Technical analysis reveals the cross remains within the descending channel, indicating a bearish outlook. The EUR/JPY spot price currently sits below both the nine- and 50-period Exponential Moving Averages (EMAs), while the 14-day Relative Strength Index (RSI) of 26.98 confirms the currency pair is in oversold territory.
The EUR/JPY may test support at 177.70, and a break below this level could further weaken the cross, pushing it towards the 10-month low of 175.70. Conversely, the pair may approach the nine-day EMA of 180.00 and the 50-day EMA of 183.33. Resistance lies at the upper boundary of the descending channel around 185.50, followed by an all-time high of 187.95.
Japanese officials' resistance to US attempts to shape Japan's macro policy has bolstered the Yen ahead of next week's Bank of Japan meeting.
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