Key Moments
- EUR/JPY touched a new 12-month low at 175.20 before recovering to trade near 176.10 during Asian hours on Friday.
- The pair remains below its nine- and 50-day EMAs, with the 14-day RSI at 34.76, signaling ongoing but non-extreme bearish momentum.
- BoJ board member Himino highlighted AI-driven inflation risks and rising inflation expectations, reinforcing a hawkish tilt that is mildly supportive for the Yen if followed by policy action.
Technical Picture: EUR/JPY Holds a Bearish Tone
EUR/JPY advanced modestly on Friday in Asian trading, hovering around 176.10 after two consecutive sessions of declines. Despite the intraday recovery, analysis of the daily chart shows the cross still moving within a descending channel, underscoring a continuing bearish bias for the pair.
The cross is trading beneath both the nine-period and 50-period Exponential Moving Averages, reinforcing the view that the short-term outlook remains tilted to the downside. These moving averages are acting as stacked dynamic resistance, limiting any sustained rebound. The 14-day Relative Strength Index stands at 34.76, positioned just above oversold territory. This suggests that selling pressure is still in play, but has not yet reached extreme levels.
Key Support and Resistance Levels
On Friday, EUR/JPY registered a new 12-month trough at 175.20. The next important support is located near the lower boundary of the ongoing descending channel, around 175.00. A decisive break below this support cluster could open the way for the pair to move toward the region surrounding the 15-month low at 169.72.
On the upside, the first technical hurdle is the nine-day EMA at 176.98. Above that, attention shifts to the upper edge of the descending channel, which is situated close to 178.70. A further barrier is found at the 50-day EMA at 179.54. A sustained move through this medium-term average would signal a bullish reversal, potentially allowing EUR/JPY to revisit the zone around the all-time high of 187.95, which was printed on April 17.
EUR/JPY: Daily Chart
BoJ’s Himino Signals Concern Over AI-Linked Inflation Pressures
Comments from Bank of Japan board member Ryozo Himino are keeping Yen traders attentive. According to the assessment, Himino’s communication scored 8.2/10 on the FXS Speechtracker, matching the historic average and indicating a consistently firm tone rather than any abrupt change in stance.
Himino’s remarks highlighted strong AI-related capital expenditure and export activity, rising medium- and long-term inflation expectations, and underlying inflation moving closer to the 2% objective. Taken together, these elements point to a clearly hawkish inclination, even as financial conditions remain accommodative and real interest rates stay low.
The caution that delaying policy adjustments could amplify upside inflation risks and potentially harm the economy strengthens the impression that the Bank of Japan is gradually moving toward additional normalization. For foreign exchange markets, the combination of brisk bank lending, elevated inflation risks, and an explicit commitment to secure stable prices through appropriate monetary policy supports a slow shift away from ultra-easy settings, a backdrop that is mildly Yen-supportive if accompanied by concrete measures.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Euro Performance Against Major Currencies
In broader FX trading, the Euro showed varying performance against other major currencies, with particular strength versus the Japanese Yen. The table below presents the percentage changes of the Euro and other major currencies against one another.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.03% | 0.04% | 0.13% | -0.00% | 0.04% | -0.22% | 0.09% | |
| EUR | -0.03% | 0.02% | 0.11% | -0.04% | -0.01% | -0.25% | 0.06% | |
| GBP | -0.04% | -0.02% | 0.08% | -0.04% | -0.02% | -0.26% | 0.04% | |
| JPY | -0.13% | -0.11% | -0.08% | -0.15% | -0.11% | -0.37% | -0.06% | |
| CAD | 0.00% | 0.04% | 0.04% | 0.15% | 0.05% | -0.23% | 0.09% | |
| AUD | -0.04% | 0.01% | 0.02% | 0.11% | -0.05% | -0.26% | 0.05% | |
| NZD | 0.22% | 0.25% | 0.26% | 0.37% | 0.23% | 0.26% | 0.31% | |
| CHF | -0.09% | -0.06% | -0.04% | 0.06% | -0.09% | -0.05% | -0.31% |
The heat map shows the percentage changes between major currencies. The base currency is taken from the left-hand column, while the quote currency is selected from the top row. For instance, choosing the Euro as the base from the left column and moving across to the US Dollar column provides the percentage move for EUR (base)/USD (quote).
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