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EUR/JPY Price Forecast: Rebound Toward 186.50 Possible as Bullish Momentum Builds

The EUR/JPY currency pair is showing signs of a potential rebound toward the 186.50 resistance level, as technical indicators point to a prevailing bullish bias in the market. Traders are closely watching key support levels and macroeconomic drivers that could influence the pair’s next move.

Technical Setup Favors Further Upside

From a technical perspective, EUR/JPY has been consolidating above the 184.00 support zone after a brief pullback earlier this week. The pair is now trading above its 20-day and 50-day moving averages, which typically signals bullish momentum. The Relative Strength Index (RSI) is hovering near 58, indicating room for further upside before entering overbought territory. A decisive break above the 185.50 immediate resistance could open the door for a move toward the 186.50 level, a key psychological and technical barrier.

Fundamental Factors Supporting the Euro

The euro has been supported by improving economic data from the Eurozone, including better-than-expected industrial production figures and resilient services sector activity. The European Central Bank’s cautious stance on further rate cuts has also provided a floor for the single currency. Meanwhile, the Japanese yen remains under pressure as the Bank of Japan maintains its ultra-loose monetary policy, keeping interest rate differentials wide in favor of the euro.

What Traders Should Watch

Key levels to monitor include the 184.00 support zone, where buyers have stepped in multiple times this month. A break below that level could negate the bullish outlook and signal a deeper correction toward 182.50. On the upside, sustained trading above 185.50 would confirm the bullish bias and make 186.50 the next target. Traders should also watch for any unexpected policy signals from the Bank of Japan or European Central Bank that could shift sentiment rapidly.

Conclusion

The EUR/JPY outlook remains cautiously bullish in the near term, with technical and fundamental factors aligning to support a potential move toward 186.50. However, traders should remain aware of resistance levels and the risk of sudden reversals driven by central bank commentary or geopolitical developments.

FAQs

Q1: What is the key resistance level for EUR/JPY right now?
The immediate resistance is at 185.50, with a more significant barrier at 186.50. A break above 185.50 would strengthen the bullish case.

Q2: Why is the yen weak against the euro?
The yen is under pressure due to the Bank of Japan’s ultra-loose monetary policy, which keeps Japanese interest rates very low compared to the Eurozone, making the euro more attractive to yield-seeking investors.

Q3: What could reverse the bullish bias in EUR/JPY?
A break below the 184.00 support level could reverse the bullish outlook. Additionally, unexpected hawkish comments from the Bank of Japan or a sharp risk-off event could trigger a yen rally.

This post EUR/JPY Price Forecast: Rebound Toward 186.50 Possible as Bullish Momentum Builds first appeared on BitcoinWorld.

The EUR/GBP exchange rate has moved sideways in the past few days as traders focus on the upcoming European Central Bank (ECB) and Bank of England (BoE) interest rate decisions. It was trading at 0.8627, down from last year’s high of 0.8865. It has formed two major chart patterns, pointing to more downside.

The daily chart shows that the EUR to GBP exchange rate has pulled back in the past few months. It has retreated from a high of 0.8865 in November last year to 0.8628. 

A closer look shows that the pair has found substantial support at 0.8615, its lowest level on February 5,  March 19, and May 25. This support is part of the descending triangle pattern, whose upper side connects the highest swings in November last year and February and May this year. The descending triangle is a common continuation sign in technical analysis

The pair has also formed a small head-and-shoulders pattern, a common bearish sign. Also, it also remained below the 50-day and 200-day Weighted Moving Averages (WMA).

Therefore, the pair will likely have a strong bearish breakout in the near term, potentially to the key support at 0.8545, the 50% Fibonacci Retracement level. 

EUR/USD chart | Source: TradingView

The EUR/GBP pair has come under pressure in the past few days as investors waited for the upcoming ECB interest rate decision. Economists polled by Reuters expect Christine Lagarde and her team to deliver the first interest rate hike of the year. 

If this happens, the bank will hike rates by 0.25% to 2.40% and the deposit facility rate to 2.25%. It will be the first time that the bank has hiked interest rates since September 2023. Also, it will be a big reversal after the bank delivered several interest rate cuts last year.

The bank’s rate hike will come as it combats the elevated inflation, which has continued rising in the past few months. Data shows that the headline CPI rose to 3.2% in May from 3.0% in the previous month. It has jumped sharply from the year-to-date low of 1.7%. Anal

The next key catalyst for the EUR/USD pair will be the upcoming Bank of England interest rate decision scheduled for Thursday. Economists expect the bank to leave interest rates unchanged in its meeting next week.

The most recent data showed that the headline Consumer Price Index retreated to 2.8% in April, helped by the ongoing government actions. Still, Polymarket traders are predicting that the bank will hike interest rates in the coming months as inflation ticks up again. 

The British pound has been somewhat noisy on Tuesday as we are looking at this market through the prism of a market that is at “fair value.”

GBP/USD

The British pound has been all over the place during trading here on Tuesday as we continue to squeeze right around the 200-day EMA. In fact, the 50-day EMA is here as well, so with all of that being said, I think we’ve got a situation where traders are looking at this as being essentially fair value between the 1.3250 level underneath offering support and the 1.3550 level above offering resistance.

As we are basically in the middle of that, it’s not a huge surprise to see that this market is likely to continue to just bounce around there. After all, this is a market that features 2 currencies that have a reasonably high interest rate attached to them, with the British pound actually being the bigger of the 2. This is why the British pound typically fares so well against the US dollar in comparison to some of its compatriots.

Key Technical Levels and Market Outlook

At this point, if we break down below the bottom of the candlestick for the trading session on Tuesday, then I suspect we will go visiting the 1.33 region again. If we can break above the high of the Monday candlestick, that could lead to a move to the 1.35 handle.

In general, I think this is a sideways range-bound market on short-term charts that traders will continue to take advantage of going forward until something structurally changes.

Right now, there’s a little bit of positivity out there due to the idea that there might be a peace deal between the Americans and the Iranians that actually lasts. So, we’ll see how this behaves, but right now we’re just, I think, working off some of that volatility through calm, sideways trading.

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Christopher Lewis is a technical analyst and market commentator at DailyForex with more than two decades of trading experience in Forex and other leveraged markets. Based in Columbus, Ohio, he specializes in chart-based analysis of major currency pairs, stock indices, commodities, and energy markets, focusing on clear support and resistance levels, trend structure, and risk management. Christopher produces daily written and video analysis for traders who rely on technical setups to navigate volatile market conditions

As seen on: Pairs Of Aces Podcast,The Trader Guy, FXEmpire

eases modestly despite inflation unexpectedly holding steady. drifts lower ahead of the FOMC .

FTSE Eases Despite Inflation Unexpectedly Holding Steady

The FTSE is little changed as investors digest softer-than-expected UK inflation data ahead of Thursday’s Bank of England rate decision, alongside falling energy prices.

Data showed unexpectedly remained unchanged at 2.8% year-on-year in May, below expectations for a rise to 3.0%, suggesting price pressures were easing even before the recent collapse in oil prices following the U.S.-Iran peace agreement.

On a monthly basis, rose 0.2%, down from 0.7% in April and below forecasts of 0.4%. , which excludes more volatile components such as food and fuel, rose to 2.6% from 2.5%, but remained below expectations of 2.7%.

Delving deeper into the figures, falling food prices helped offset higher airfares and petrol prices. Meanwhile, service sector inflation rose to 3.7%, slightly above expectations, pointing to sticky domestic inflationary pressures.

Even so, the broader picture supports the Bank of England’s wait-and-see approach. Softer inflation, a weakening labour market and a recent contraction in reduce the need for further policy tightening, particularly as falling oil prices should ease inflation pressures in the months ahead.

has fallen to around $80 per barrel, a three-month low, following the preliminary U.S.-Iran agreement and expected reopening of the Strait of Hormuz. Lower energy prices should eventually feed through to lower fuel and transport costs across the economy.

The market scaling back expectations for further BoE tightening has helped rate-sensitive sectors such as housebuilders outperform. Meanwhile, energy stocks are under pressure from falling oil prices, while utilities have also weakened.

Looking ahead, attention turns to the FOMC decision later today. A more hawkish-than-expected could support the and weigh on , which may benefit the multinational-heavy FTSE 100 through overseas earnings translation. However, higher global bond yields could also limit gains in broader equity markets.

FTSE Forecast – Technical Analysis

The FTSE continues to trade within a descending triangle pattern. The index recently rebounded from support around 10,170, recovering above the 50-day SMA and testing falling trendline resistance.

A break above the trendline would weaken the bearish pattern and a move above 10,570, the June high, would create a higher high, opening the door towards 10,725, the April peak.

On the downside, initial support can be seen at the 50-day SMA around 10,400. A break below 10,170 would create a lower low and expose the 200-day SMA at 10,000.

USD/JPY Drifts Lower Ahead of the FOMC Rate Decision

USD/JPY is drifting lower towards the 160.00 level as traders await the Federal Reserve’s interest rate decision under new Chair Kevin Warsh later today.

The Fed is widely expected to leave rates unchanged at 3.50%-3.75%. However, attention will focus on the policy statement, updated economic projections and the dot plot for clues regarding the outlook for U.S. interest rates.

The FOMC decision comes amid an improving backdrop as falling oil prices and the prospect of a lasting U.S.-Iran agreement have lowered inflationary worries. However, U.S. inflation remains elevated at 4.2%, while the labour market continues to show resilience.

Markets are currently pricing in the possibility of a Fed rate hike later this year. If Warsh does not push back against those expectations, investors may interpret that as a hawkish signal, supporting the U.S. dollar. Conversely, if he does push back, then this could raise questions about his credibility as inflation is double the Fed’s target level.

This highlights the delicate balancing act facing the new Fed Chair in his first meeting, having been selected by Trump who has been vocal about wanting rate cuts.

The decision comes shortly after the Bank of Japan raised interest rates by 25 basis points to 1%, the highest level since 1995. However, the move had little impact on markets as it was largely anticipated. The yen remains weak near 160 per dollar and the continues to trade close to record highs.

The pair’s proximity to 160 keeps investors alert to the possibility of intervention from Japanese authorities, who have previously acted to support the currency around these levels.

USD/JPY Forecast – Technical Analysis

USD/JPY continues to trade above its rising trendline and above both the 50-day and 200-day SMAs, keeping the broader uptrend intact.

However, momentum is slowing, with a bearish RSI divergence emerging as price tests resistance around 160.60. While not a reversal signal on its own, it suggests upside momentum is weakening despite higher highs in price.

Buyers need to break above 160.70, the 2025 high, to bring 162.00 into focus, the 2024 peak.

On the downside, support is seen around 160.00 and the 20-day SMA. Below here, the 50-day SMA near 159.00 comes into focus, followed by 158.00 and rising trendline support.

Original Post

The pair’s price renewed its attempts to pressure the stable resistance at 215.50, trying to find a way to resume the previously expected bullish attack. We recommend waiting for the price to achieve the required breakout, which would strengthen the chances of reaching positive levels that may begin at 216.60 and extend in the near term toward 217.55.

However, failure to break through would push the price to form downward corrective waves, putting pressure on the 214.10 level and reaching the stable support at 213.50, which in turn represents the key level for confirming the proposed direction for the upcoming trades.

The expected trading range for today is between 214.50 and 216.65

Trend forecast: Bullish

– Written by


David Woodsmith

STORY LINK Pound-to-Dollar Forecast: Peace Deal Hopes Push GBP/USD to 10-Day Best

The Pound to Dollar exchange rate (GBP/USD) climbed to 10-day highs above 1.3460 after reports that the US and Iran had agreed a peace deal boosted risk appetite and reduced demand for the safe-haven US Dollar.

Lower oil prices and improving market sentiment helped Sterling advance, although investors remain cautious ahead of a crucial week of central bank decisions and key UK political developments.

GBP/USD Forecasts: Hits 10-Day Highs

The US and Iran agreement of a peace deal has underpinned risk appetite and curbed potential dollar support with the Pound to Dollar (GBP/USD) exchange rate advancing to 10-day highs at 1.3460 before settling around 1.3430.

As well as the Middle East situation, there is a key Federal Reserve meeting while the Bank of England (BoE) policy meeting and pivotal Makerfield by-election are due on “Super Thursday”.

There remains tough resistance in the 1.3500 area and, according to UoB; “while the increase in momentum suggests GBP could break above 1.3465, based on the prevailing momentum, it is too early to tell if GBP can break above 1.3490.”

On a longer-term perspective, ING considers that GBP/USD will retreat to 1.31 on a 3-month view before recovering to 1.35 into the year-end period.

Overnight, the US and Iran agreed a peace deal with a potential signing on Friday. Oil prices have moved lower while there has been a boost to risk appetite with equities posting net gains

ING is doubtful that risk appetite can strengthen sharply; “Financial markets have had opportunities to react to this kind of deal on several occasions already, and the MSCI World Index is already 5% higher than before the war. This suggests risk assets might not need to travel too far on today’s welcome news.”

As far as the Federal Reserve is concerned, markets expect rates to be held at 3.75%, but there is an important element of uncertainty over the statement and potential guidance. There is also the risk of a split vote.

ING commented; “The market clearly expects a less dovish set of communications (with an easing bias and expected 2026 rate cut removed), but we suspect he will have to talk tough on inflation to avoid upsetting the long end of the bond market.”

MUFG, however, does not see major dollar support; “The US rate market has already moved to scale back Fed rate hike expectations, but there is room for US yields and the US dollar to fall further if Kevin Warsh does not provide a hawkish policy surprise this week.”

Traders also expect the BoE to hold rates at 3.75% with a split vote as the majority back waiting to assess inflation trends while a minority are expected to back a rate hike.

MUFG senior economist Henry Cook expressed concern over a waiting game; “We do ​think there is a risk that they end up dithering a bit too much. Playing for time is potentially not the best strategy here.”

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EUR/USD Analysis Summary Today

• Overall Trend: Bearish in the medium term with short-term rebound attempts.

• Support Levels for EUR/USD Today: 1.1570 – 1.1510 – 1.1460

• Resistance Levels for EUR/USD Today: 1.1655 – 1.1690 – 1.1780

EUR/USD Trading Signals:

• Buy scenario: From the support level of 1.1530 with a target of 1.1730 and a stop-loss at 1.1470

• Sell scenario: From the resistance level of 1.1710 with a target of 1.1560 and a stop-loss at 1.1780

Technical Analysis of EUR/USD Today

The EUR/USD pair is moving within a clear bearish trend inside a descending price channel extending since mid-April. The general trend still leans in favor of the sellers despite the current corrective rebound that followed the baseline test of strong support near the 1.1500 level.

This recovery comes as part of a corrective move toward dynamic resistance levels that coincide with the boundaries of the descending channel. This places the price before an important technical test that could determine the fate of the short-term trend: will the correction continue, or will selling pressure return once again?

Technically, the Fibonacci levels drawn from the high at 1.1690 to the low at 1.1500 indicate pivotal resistance zones that must be closely monitored during the current move.

The 38.2% correction level is located at 1.1570, followed by the 50% level at 1.1590, while the 61.8% level extends to 1.1615, which nearly coincides with the upper boundary of the descending channel. This confluence of Fibonacci levels with the descending channel’s resistance represents a potentially strong supply zone, which could push the price to rebound back toward the recent low or even register new lows if bearish momentum returns.

From a Moving Averages perspective, the 100-day Simple Moving Average (SMA) remains below its 200-day counterpart, reflecting the continuation of the overall bearish structure. Furthermore, both averages are sloping downward and sit well above current trading levels, reinforcing the likelihood of continued negative pressure over the medium term.

As for momentum, the Stochastic indicator has risen sharply from oversold territory, indicating a temporary improvement in bullish momentum as it currently heads toward the midpoint of its range. This supports the continuation of the current corrective move before any potential resumption of the downward trend.

Similarly, the Relative Strength Index (RSI) is experiencing a gradual recovery from its recent low levels, with additional room to move upward before entering the overbought zone.

However, the emergence of weakness signals near current resistance levels could be an early indication that the correction is over and the downtrend is regaining control.

EUR/USD Future Outlook

The EUR/USD pair may remain within its current price range on reputable trading platforms until the market reacts to the US Federal Reserve’s announcement this week. The euro’s gains came as investors flocked to riskier assets following the US and Iran’s announcement of a preliminary agreement to end their three-month-long conflict.

Trading advice:

It is preferable for traders to monitor the price reaction at the 1.1700 resistance level, while maintaining strict risk management given the ongoing uncertainty in the markets.

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