As EUR/JPY’s momentum continues towards the 166.85 area on Thursday, the charts reflect a notable rise and improved performance. At a time when the price is exceeding levels not seen since 2008, the Relative Strength Index (RSI) indicates overbought, which enhances the positive possibilities of the pair heading towards higher levels.
The first resistance level is at the 166.82 area, which may represent an initial challenge to the current rally. However, positive momentum and improved performance enhance the opportunity to break this level and move towards higher levels. If a rise is achieved, the next level of resistance could be the 168.50 area. On the other hand, the initial support level remains at the 165.35 area, where the pair can find strong support in the event of a price decline. If this level is broken, this could lead to additional challenges to the upside, with a possible drop to lower levels towards the 164.00 area.
The EUR/JPY pair continues to achieve strong and steady gains, supported by improved performance and rising momentum. With resistance and support levels identified, traders must follow technical and fundamental developments to identify appropriate opportunities in this context.
EUR/JPY Analysis: Positive momentum continues as BoJ and CPI decisions await: During early European trading hours on Thursday, the EUR/JPY currency pair continues to trade in positive territory for the fifth day in a row, rising to the 166.85 area, its highest levels since 2008. This upward move comes as Tokyo’s CPI for April is expected to be released on Friday, followed by the BoJ’s decision on interest rates.
The BoJ is expected to leave interest rates and bond purchase volumes unchanged in its policy, since it raised interest rates in March for the first time since 2007
Forecasts of upcoming resistance and target levels:
The EUR/JPY pair remains of interest to traders, as it continues to make strong gains. With the BoJ policy expected to continue, upward pressure may continue on the pair, as markets react to the release of the CPI in Tokyo. In this context, traders must monitor technical and fundamental developments to make the right investment decisions in this sensitive period.
Technically, the EUR/JPY currency pair remains bullish without change on the 4-hour chart. The pair is trading above the 50- and 100-period EMAs, reflecting positive price bias. In addition, the Relative Strength Index (RSI) is firmly in the bullish zone above 70 levels, indicating the strength of the current upward momentum.
However, the RSI should be monitored for overbought condition, as this phenomenon indicates that there may be consolidation before further upside in the EUR/JPY pair in the near term. Since trading in the overbought zone may lead to short-term corrections or sideways movements, traders should carefully monitor the development of the market to identify the right opportunities and evaluate possible points for entering or exiting trading positions.
Although the EUR/JPY pair continues to be bullish, traders need to be cautious, especially with the Relative Strength Index (RSI) being overbought. This may lead to short-term corrections or even sideways price movements. It is also important to monitor other technical patterns such as Japanese candlesticks and the presence of support and resistance on the chart. The EUR/JPY pair is expected to face the first barrier in the uptrend at the 166.82 area, which coincides with the upper border of the Bollinger band. By surpassing this level, the psychological barrier of the 167.00 area becomes the next hurdle to overcome. These areas are considered important levels to determine the strength of the pair’s current rise.
Manage risks well and make informed decisions
If the pair breaks the 167.00 area, it could trigger a further rise towards the 2007 annual high at 168.95. With this level crossed, the 2008 highs become the next target, with the top area at 169.78 in July 2008.
This analysis reflects a positive future outlook for the EUR/JPY pair, which requires close monitoring to determine how strong the upward momentum is and the extent to which it can achieve the mentioned upper levels. It is also necessary to monitor signs of weakness or pullbacks in case the pair does not achieve these levels, which could indicate a change in market dynamics.
Determining the correct entry and exit points depends on the trading strategy and the trader’s goals. Traders can consider using additional tools such as general volatility indicators and other techniques to enhance their trading decisions. Traders should be careful and follow good money management, and avoid over-investing or trading with large amounts. If a trader feels uncertain, staying on the edge and waiting until the next trend becomes clear can be the best option.
On the other hand, the initial support level in the EUR/JPY pair is near the March 20 highs at 165.35. In case of a further decline, the next support level to watch is at the 50-period EMA at 165.11, which is followed by the 100-period EMA at 164.62.
If these support levels are broken, it could trigger a further pullback towards the lower Bollinger band at 164.30. This level is very important, as it can turn into a strong support point that reflects negative price movements. It is essential for traders to remain cautious and closely follow price developments at these key support levels, as they can play a decisive role in guiding the next direction of the EUR/JPY pair.
