26.05.202515:56 Forex Analysis & Reviews: EUR/JPY. Analysis and Forecast

The EUR/JPY pair started the new week with a positive momentum, breaking a three-day losing streak that had dragged the pair almost down to the key 161.00 level.

The decision by U.S. President Donald Trump to postpone the introduction of tariffs against the European Union helped the single currency climb to the round level of 163.00.

From a technical perspective, the EUR/JPY pair showed resilience below the 200-day simple moving average (SMA). Today's momentum favors the bulls; however, neutral oscillators on the daily chart call for caution due to fundamental factors. These include diverging monetary policy expectations between the Bank of Japan and the European Central Bank, as well as geopolitical risks—which tend to benefit the safe-haven Japanese yen.

As a result, the intraday momentum faced strong resistance at the round 163.00 level. However, sustained strength above this threshold would indicate that the recent pullback from the yearly high has run its course, paving the way for further upside. The EUR/JPY pair could then attempt to break through the supply zone at 163.40–163.45, with an eye on reclaiming the 164.00 level.

On the other hand, weakness below the nearest support at 162.40 or the 50-day SMA could attract buyers, remaining limited by the 162.00 level. This is followed by the 200-day simple moving average around 161.45, a decisive break of which would shift the short-term bias in favor of the bears. In that case, the EUR/JPY pair could fall back to retest the 161.00 level, eventually dropping toward the psychological 160.00 level.