EUR/JPY Price Forecast: Trades below 177.50 after pulling back from descending channel top
EUR/JPY depreciates after two days of gains, trading around 177.40 during Asian hours on Wednesday. The technical analysis of the daily chart suggests that the currency cross is remaining within a descending channel pattern, indicating a prevailing bearish bias.
The EUR/USD currency pair experienced a rise to near 1.1235 during the early European trading hours on Wednesday. The US Dollar weakened as early results from the US midterm elections indicated that Democrats had gained control of both the US Senate and the House of Representatives. Currency strategist Carol Kong of Commonwealth Bank of Australia anticipated that a Democratic sweep would likely result in further weakness for the US dollar, due to potential limitations on government spending during Trump's term.
Despite the recent price surge, EUR/USD remains capped below the 100-day Simple Moving Average (SMA), indicating that the broader trend is still bearish. The EUR's momentum, however, is showing signs of building, with some analysts predicting a potential test of the 1.1250 level. On the downside, the strong support level of 1.1160 is also noted as a key resistance point for the pair.
Technical indicators suggest that the Euro is stabilizing in its current range, with the Relative Strength Index (RSI) at 48.9, just below the neutral mark. Analysts point to the ECB's hawkish stance, with President Christine Lagarde suggesting a December rate hike is very likely, supporting the resilience of the Euro against downward pressure.
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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