EUR/JPY Price Forecast: Strengthens to near 183.00, bullish tone remains intact

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The EUR/JPY cross attracts some buyers near 182.90 during the early European session on Thursday.

EUR/JPY gathers strength to around 182.90 in Thursday’s early European session.
The positive outlook for the cross prevails in the medium term above the key 100-day EMA.
The first upside barrier to watch is 183.35; the initial support level emerges at 180.75.

The EUR/JPY cross attracts some buyers near 182.90 during the early European session on Thursday. Traders raise their bets that the European Central Bank (ECB) will hold its benchmark interest rate steady at 2.0% all year before possible rate hikes next year, which lifts the Euro (EUR) against the Japanese Yen (JPY).

Traders await the release of Japan’s National Consumer Price Index (CPI) report, which is due on Friday. The annual inflation rate eased to 2.1% in December 2025, reaching its lowest level since March 2022. Any signs of hotter inflation in Japan could boost expectations for the Bank of Japan (BoJ) to raise interest rates sooner than previously anticipated. This, in turn, could support the JPY and create a headwind for the cross.

Technical Analysis:

In the daily chart, EUR/JPY holds above the rising 100-day EMA, preserving a medium-term bullish bias. The average continues to slope higher, keeping bears on the back foot. RSI at 47.83 (neutral) has edged up from recent troughs, and a move through 50 would strengthen topside momentum.

Bollinger Bands are starting to narrow, flagging cooling volatility as price trades beneath the midline but above the lower band. Initial resistance stands at the Bollinger middle band at 183.35, while immediate support rests at the 100-day EMA at 180.75. A daily close above the Bollinger middle band could open the path toward the upper band at 186.00, while a break below the 100-day EMA would expose 180.68 and risk a deeper retracement.

(The technical analysis of this story was written with the help of an AI tool.)

Japanese Yen FAQs

What key factors drive the Japanese Yen?

The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

How do the decisions of the Bank of Japan impact the Japanese Yen?

One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.

How does the differential between Japanese and US bond yields impact the Japanese Yen?

Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.

How does broader risk sentiment impact the Japanese Yen?

The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.