News
7x24
Quotes
Economic Calendar
Video
Data
- Names
- Latest
- Prev.
EUR/JPY Stays Elevated as Japan Policy Risks Outshine Eurozone Concerns
Traders' Opinions
Summary:
The yen continues to crumble as the Bank of Japan’s slow policy shift contrasts sharply with a firming ECB outlook, keeping EUR/JPY near multi-decade highs with technicals pointing to further upside toward 185.50.
Buy
TradingEURJPY
EXP
184.100
Entry Price
185.500
TP
183.300
SL
183.993 +0.202 +0.11%
0
Point
Flat
183.300
SL
CLOSING
184.100
Entry Price
185.500
TP
The Japanese yen continues to struggle near the bottom of the major currency performance table, extending its underwhelming run during thin holiday trading on Wednesday. Against the euro, the yen remains firmly on the defensive, with EUR/JPY gravitating toward the 184.00 level by the European midday session. The pair rebounded from the 183.50 area on Tuesday, but the recovery has done little to alter the broader narrative of sustained yen weakness.
Viewed from a longer-term perspective, the cross remains uncomfortably close to its cycle highs. EUR/JPY is trading only a short distance below the long-term peak near 185.00 reached earlier this month and is on track to close the year with gains of more than 14%. Such a move is striking not only for its scale but also for its persistence, underscoring how deeply entrenched the negative sentiment toward the yen has become.
The primary driver of that sentiment continues to be the Bank of Japan’s hesitant approach to monetary normalisation. After years of ultra-loose policy, investors had hoped for a clearer and more decisive exit strategy. Instead, the BoJ has delivered cautious signals that tightening will continue, while offering little guidance on timing or pace. The latest Summary of Opinions from the central bank reaffirmed its commitment to further rate increases, yet stopped short of outlining a concrete path forward. This lack of clarity has reinforced the perception that any tightening will be slow, cautious and easily derailed by political considerations.
Those political considerations are increasingly important. Prime Minister Sanae Takaichi’s expansionary fiscal stance has revived concerns about Japan’s already stretched public finances, raising doubts about how aggressively monetary policy can tighten without destabilising growth. At the same time, lingering uncertainty over potential US trade tariffs under Donald Trump has added another layer of risk for Japan’s export-oriented economy. Together, these factors have created what many investors see as a perfect storm for the yen, helping to explain why it has emerged as the weakest major currency performer of 2025.
In this environment, upside attempts in the yen have consistently failed to gain traction. The government is widely expected to oppose anything more than a very gradual normalisation cycle, effectively limiting how far Japanese yields can rise relative to their global peers. As long as that remains the case, yield differentials are likely to continue favouring yen selling on rallies rather than encouraging a sustained recovery.
By contrast, the euro has found modest but meaningful support from shifting expectations around European Central Bank policy. In recent weeks, ECB communication has increasingly suggested that the easing cycle may be over. While officials remain cautious and data-dependent, markets are beginning to price the possibility that the next policy move could be a rate hike, potentially in the second half of next year. That change in tone has given the euro additional lift, particularly against low-yielding currencies such as the yen.
Technical Analysis
From an analytical standpoint, this divergence in central bank trajectories remains the dominant force shaping EUR/JPY. Even without a strong growth impulse from the euro zone, relative policy expectations have been enough to keep the cross elevated. Unless the BoJ surprises markets with a clearer and more assertive tightening signal, or global risk sentiment deteriorates sharply enough to trigger broad safe-haven demand, the balance of risks continues to tilt against the yen.
The technical picture reinforces that view. EUR/JPY continues to trade within a well-defined upward channel, confirming that the broader bullish structure remains intact. Recent price action shows the pair consolidating rather than reversing, forming a bullish triangle pattern that typically precedes trend continuation. The series of higher lows over recent sessions highlights the willingness of buyers to step in on dips, absorbing selling pressure without allowing a deeper correction to develop.
As price action compresses near the upper boundary of this consolidation, the probability of a directional break is increasing. A strong bullish candle closing above the upper trendline would confirm a breakout and likely attract momentum-driven flows, rather than trigger profit-taking. In that scenario, the next area of interest sits around 185.50, extending beyond this month’s highs and reinforcing the sense that the rally has not yet run its course.
TRADE RECOMMENDATION
BUY EURJPY
ENTRY PRICE: 184.10
STOP LOSS: 183.30
TAKE PROFIT: 185.50
Risk Warnings and Investment Disclaimers
You understand and acknowledge that there is a high degree of risk involved in trading with strategies. Following any strategies or investment methodologies is the potential for loss. The content on the site is being provided by our contributors and analysts for information purposes only. You alone are solely responsible for determining whether any trading assets, or securities, or strategy, or any other product is suitable for you based on your investment objectives and financial situation.
Quick Access to 7x24
Quick Access to More Editor-selected Real-time News
Exclusive video for free
FastBull project team is dedicated to create exclusive videos
Real-time Quotes
View more faster market quotes
More comprehensive macro data and economic indicators
Members have access to entire historical data, guests can only view the last 4 years
Member-only Database
Comprehensive forex, commodity, and equity market data
English
English
العربية
繁體中文
简体中文
Bahasa Melayu
Bahasa Indonesia
ภาษาไทย
Tiếng Việt
Copyright © 2026 FastBull Ltd
Home News Columns 7x24 Economic Calendar Quotes Video Data WarehouseAnalysis AI Signal Pro User Agreement Privacy Policy About Us
Risk Disclosure
The risk of loss in trading financial assets such as stocks, FX, commodities, futures, bonds, ETFs or crypto can be substantial. You may sustain a total loss of the funds that you deposit with your broker. Therefore, you should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.
No consideration to invest should be made without thoroughly conduct your own due diligence, or consult with your financial advisors. Our web content might not suit you, since we have not known your financial condition and investment needs. It is possible that our financial information might have latency or contains inaccuracy, so you should be fully responsible for any of your transactions and investment decisions. The company will not be responsible for your capital lost.
Without getting the permission from the website, you are not allow to copy the website graphics, texts, or trade marks. Intellectual property rights in the content or data incorporated into this website belongs to its providers and exchange merchants.