EURJPY: Bullish Rebound from Key Demand ZoneEURJPY has bounced off a critical demand zone and is showing signs of a bullish recovery. Despite the recent pullback, the pair’s structure remains fundamentally and technically bullish, driven by JPY weakness and EUR resilience.
Technical Analysis (4H Chart)
Pattern: Price tested a strong demand zone near 170.35–170.50 and rejected it aggressively.
Current Level: 170.77, starting a potential bullish leg toward higher resistance levels.
Key Support Levels:
170.35 – key demand zone and invalidation level for bulls.
169.90 – deeper support if demand zone breaks.
Resistance Levels:
172.17 – first bullish target and interim resistance.
173.64 – major target if bullish continuation sustains.
Projection: A successful rebound from 170.35 could drive price toward 172.17 initially, then 173.64 if momentum holds.
Fundamental Analysis
Bias: Bullish.
Key Fundamentals:
EUR: ECB’s slower path toward easing supports EUR stability relative to JPY.
JPY: Weakness persists as BoJ maintains dovish bias, though FX intervention risk limits JPY downside speed.
Global Sentiment: Mild risk-on mood supports EUR strength against JPY.
Risks:
BoJ verbal intervention or actual FX intervention could trigger temporary JPY strength.
Sharp reversal in global risk sentiment could weaken EUR/JPY.
Key Events:
ECB speeches and data (CPI, growth updates).
BoJ FX comments and broader market risk appetite.
Leader/Lagger Dynamics
EUR/JPY is a leader among JPY pairs, often moving in sync with GBP/JPY and CHF/JPY. Its movement also tends to precede confirmation in risk-sensitive JPY crosses.
Summary: Bias and Watchpoints
EUR/JPY is bullish from the 170.35 demand zone, with a potential move toward 172.17 and 173.64. Key watchpoints include ECB communication, BoJ stance, and market risk sentiment. As long as 170.35 holds, bulls remain in control.
