The EUR/JPY pair is showing signs of strength as it drifts higher towards the key level of 162.00 in Wednesday’s early European session. Despite maintaining a negative outlook below the 100-period EMA and bearish RSI indicator, the cross is finding support from a weaker Japanese Yen due to Japan’s trade deficit data. Japan’s Merchandise Trade Balance fell into a deficit of ¥621.84 billion, boosting EUR/JPY.
Traders will be closely monitoring upcoming data releases, including the preliminary PMI for August from Germany and the Eurozone, as well as Japan’s National CPI for July and a speech by the Bank of Japan Governor. These events could provide further direction for the EUR/JPY pair.
Technically, EUR/JPY remains bearish on the 4-hour chart, with the cross below the key 100-period EMA and RSI indicating room for further downside movement. The immediate resistance level is at 162.70, with potential upside targets at 162.85 and 163.75. On the downside, support levels to watch are 161.17, 160.42, and 159.91.
EUR/JPY 4-hour chart
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