EUR/JPY Price Forecast: Upward Movement Is Expected
EUR/JPY is an interesting currency pair as it represents the currencies from Europe and Japan. Although the ECB has moved towards the hawkish side, the BOJ is still sticking to its dovish stance and is not budging even one bit. If we look at the technical charts of EUR/JPY, it seems an interesting formation is on the horizon.
Based on the technical outlook, EUR/JPY seems to be capped by a declining trendline which started in October last year.
However, there's also a bullish trendline that is preventing the EUR/JPY from falling down, which started in August 2022. So in a sense, there's a battle between the bears and bulls, and we will still have to wait a few months for the final outcome.
EUR/JPY Can Touch 143.00 - 144.00
For the short-term, EUR/JPY has the potential to touch the area around 143.000 - 144.000. For now, EUR/JPY is trading close to the 140.000 price range - This tells us that a significant upside is expected in the Euro & Japanese Yen pair.
If we look at the bigger picture, the symmetrical triangle on the daily chart will decide the next move in this pair. If we get a bullish breakout of EUR/JPY, it will add 8% to the pair's value. And if we get a bearish breakout in EUR/JPY, a loss of 8% will become the most probable outcome.
As per the fundamental outlook of EUR/JPY, the European currency is in a much stronger position as compared to the Japanese Yen. This also becomes clear upon looking at the daily chart of EUR/JPY - It has been in a bullish trend since April 2022 and seems to be consolidating for now.
But if Japan shifts its policy and becomes hawkish, it would lead to some major buying pressure in the JPY currency. In this case, the EUR/JPY will take a dive down on the strength of the JPY. But for now, there are no chances of anything like that from the Japanese side.