The EUR/JPY pair is currently trading near 163.55 in the early Asian session on Friday, showing a slight weakness after a four-day winning streak. The Japanese Yen has gained strength following Japan’s better-than-expected second-quarter GDP growth of 0.8% QoQ, raising speculation of a potential interest rate hike by the Bank of Japan (BoJ).
Technical analysis reveals that the pair is on an uptrend, supported by trading above the 100-period Exponential Moving Average (EMA) and a bullish Relative Strength Index (RSI) reading of 68.50. The immediate resistance level is at 164.00, with further targets at 164.89 and 166.56 on the upside. On the downside, support levels are at 163.10-163.00, 161.95, and 160.59.
EUR/JPY 4-hour chart
Japanese Yen FAQs
- The value of the Japanese Yen is influenced by various factors such as the performance of the Japanese economy, the Bank of Japan’s policies, and risk sentiment among traders.
- The Bank of Japan plays a crucial role in controlling the value of the Yen through interventions in the currency markets and monetary policies.
- The policy divergence between the Bank of Japan and other central banks, particularly the US Federal Reserve, affects the exchange rate between the US Dollar and the Japanese Yen.
- The Japanese Yen is considered a safe-haven currency, attracting investors during times of market turmoil due to its perceived stability.
In conclusion, the EUR/JPY pair is facing a critical juncture with potential upside targets if the bullish momentum continues. Traders should closely monitor key support and resistance levels to navigate their trading decisions effectively in the current market environment.