- EUR/JPY rebounded from daily lows at 139.03 and reached a daily high of 141.19 before losing steam.
- A rally in EUR/JPY and reaching a daily close above the 200-day EMA keeps bulls hopeful of higher prices.
The Euro (EUR) rallied sharply on Friday ahead of the weekend as the Japanese Yen (JPY) weakened following the Bank of Japan (BoJ) monetary policy meeting. Combat determined to maintain its dovish stance and yield curve (YCC) management. Therefore, EUR/JPY is gaining strength, exchanging hands at 140.63, up more than 1% from its opening price.
EUR/JPY Price Analysis: Technical Outlook
EUR/JPY daily diagram depicts the pair gaining the 20 and 200-day exponential moving averages (EMA) at 140.45 and 140.15 each, keeping the bulls hopeful of higher prices. Additionally, the Relative Strength Index (RSI) is heading north and is set to turn bullish, further cementing the neutral-to-bullish bias, while the Rate of Change (RoC) is displaying strong bullish sentiment in the pair.
So EUR/JPY’s path of least resistance is up. Thus, EUR/JPY’s first resistance would be the January 20 high of 141.19, followed by the January 18 daily high of 141.68 and the 142.00 figure. An alternative scenario is that a failure of EUR/JPY at 141.00 could pave the way for further declines. Key support levels for EUR/JPY would be the psychological levels of 140.00, followed by the January 20 daily low of 139.03 and then the January 19 swing low of 137.91.