- EUR/JPY softens to around 184.50 in Thursday’s early European session.
- The positive outlook of the cross remains intact above the key 100-day EMA.
- The first upside barrier to watch is 185.20; the initial support emerges at 184.00.
The EUR/JPY cross loses traction near 184.50 during the early European session on Thursday. The Japanese Yen (JPY) edges higher against the Euro (EUR) as traders remain wary of intervention after strong warnings ahead of an election in Japan. Japan’s Finance Minister Satsuki Katayama issued another verbal warning on Wednesday, saying officials would take “appropriate action against excessive FX moves without excluding any options.”
On the other hand, signs that the European Central Bank (ECB) appears to be near the end of its rate-cutting cycle could provide some support to the EUR. Financial markets currently see limited scope for immediate action, with a chance of rates remaining unchanged at the next meeting. Some analysts expect a rate reduction later in 2026, though a hike is considered unlikely given the subdued inflation backdrop.
Technical Analysis:
In the daily chart, EUR/JPY holds above the rising 100 EMA at 179.01, maintaining an upside bias. Price trades in the upper half of the Bollinger envelope and the bands show mild contraction, flagging a pause within the advance. RSI at 59.76 is neutral-bullish, showing firm momentum. Immediate resistance stands at the upper band at 185.20, while initial support rests at 184.00.
A daily close above 185.20 could extend the move as volatility rebuilds from the recent band contraction. Failure to clear that cap would expose the lower band at 182.76, and a deeper pullback would test the 100 EMA at 179.01. RSI holding above 50 would favor continuation, while a drop toward that threshold would point to consolidation within the range.
