EUR/JPY rose after small losses the day before and traded at 187.83 during Asian hours on Friday. This was a new all-time high, with price moving higher inside an ascending channel.
The pair stayed above the nine-day and 50-day Exponential Moving Averages (EMAs). These levels were used as signals that the short-term trend remained upward.
Momentum Signals And Overbought Risk
The 14-day Relative Strength Index (RSI) was near 71, in overbought territory. This can point to strong momentum but also the risk of a pullback and consolidation.
Next resistance was noted at 188.00, then near 188.50 at the top of the ascending channel. Key support was placed at the nine-day EMA of 186.76.
If price moved below 186.76, focus could shift to the lower channel boundary around 185.80. Further down, the 50-day EMA support was listed at 184.46.
The report said the technical analysis was produced with help from an AI tool.
Strategy And Risk Management Considerations
We are seeing the EUR/JPY push into uncharted territory, which confirms the powerful uptrend we’ve been riding. This move is fundamentally supported by recent Eurozone inflation data for March 2026 coming in at 2.8%, keeping the ECB cautious, while the Bank of Japan continues to signal accommodative policy. The policy divergence between the two central banks remains the primary driver for this cross.
The Relative Strength Index hitting 71 is a clear signal to be cautious about entering new long positions at these record highs. We should anticipate a potential pullback, possibly toward the nine-day EMA at 186.76. This level presents an opportunity to buy call options or add to long futures positions, allowing us to re-enter the trend at a better price.
For those looking to trade the immediate momentum, the psychological level of 188.00 is the next clear target. A bull call spread could be an effective strategy to profit from a move toward the upper channel boundary around 188.50 while defining risk. This is a sensible approach given the overbought conditions.
On the downside, a break below 186.76 would be our first warning that the short-term momentum is fading. We would then look to the 185.80 level as the next major support. Traders holding long positions should consider buying protective put options if we see a decisive close below the nine-day EMA.
We remember that even the Bank of Japan’s historic policy shift away from negative interest rates back in 2024 did little to halt the Yen’s long-term weakness. Looking back at late 2025, we saw similar overbought RSI readings lead to brief consolidations before the uptrend resumed. This historical pattern suggests that viewing any potential dips as buying opportunities is the correct strategy for now.
