EUR/JPY Price Forecast: Trades near nine-day EMA while holding above 176.50

• At 176.45, the nine-day EMA provides immediate support that EUR/JPY may test.
• A reading of 44.16 on the 14-day Relative Strength Index points to mild downward momentum.
• Near 177.90, the upper edge of the descending channel forms the main resistance level.

Around 176.70 in Tuesday’s Asian session, EUR/JPY is edging down following the previous day’s modest advance. On the daily chart, technical analysis indicates that the cross continues to trade inside a descending channel, signalling that the prevailing bias remains bearish.

Although EUR/JPY remains just above its nine-period Exponential Moving Average (EMA), the 50-period EMA continues to limit the upside. Trading below the longer-term average points to a slightly bearish bias. Meanwhile, the 14-day Relative Strength Index (RSI) remains in neutral territory at 44.16, indicating mild downward momentum rather than heavy selling pressure.

At 176.45, the nine-day EMA offers immediate support, which EUR/JPY is testing. Below that comes the 12-month low of 175.07 recorded on 30 October, with the descending channel’s lower edge providing further support around 174.30. Should the cross break beneath the channel, it would have scope to move towards the area around the 15-month low of 169.72.

A recovery in EUR/JPY may bring the descending channel’s upper edge near 177.90 into view, ahead of the 50-day EMA at 178.72. Breaking decisively above this medium-term moving average would trigger a bullish reversal, helping the cross move towards the region of its all-time high of 187.95, recorded on 17 April.

Europe’s fiscal and energy pressures curb the Euro’s appeal

A weakening Dollar does not necessarily leave the Euro looking attractive, analysts at DBS Group Research warn. They note that “Europe’s fiscal and political uncertainties, particularly in France, and its vulnerability to elevated energy prices complicate the search for viable alternatives.” In their view, these combined risks constrain investors’ confidence in shifting from the Dollar into Eurozone assets, notwithstanding recent currency movements.

(The technical analysis of this story was written with the help of an AI tool. Know more.)