The EUR/JPY pair is nearing its highest point ever, which is 178.82. The Relative Strength Index (RSI) remains above 50, suggesting a positive outlook. The first support level is at 178.00, and the pair is trading above the nine-day EMA. Currently around 178.10, EUR/JPY has risen over 0.25% early on Monday during European trading. If it exceeds 178.82, it may aim for the psychological level of 180.00. On the downside, immediate support is at 178.00, followed by the nine-day EMA at 177.33.

Break Below Key Levels

If the pair drops below the nine-day EMA, it could test the uptrend line at 176.40 and the 50-day EMA at 175.39. Falling below this range may create downward pressure, pushing EUR/JPY toward the two-month low of 172.14 reached on September 9. The Euro recorded the biggest gain against the Japanese Yen, increasing by 0.39%. Other currencies, like the US Dollar, showed little change against the Euro, while the New Zealand Dollar rose 0.10% and the Swiss Franc decreased by 0.07%. The heat map shows percentage changes in major currency pairs, with the base currency from the left column and the quote currency from the top.

Strong Upward Momentum

The EUR/JPY cross is gaining strong upward momentum, likely to challenge the previous record high of 178.82 set in October 2025. This surge is mainly due to the policy differences between the European Central Bank (ECB) and the Bank of Japan (BoJ). Eurozone inflation for October was reported at 2.8%, keeping the ECB’s stance aggressive while the BoJ continues its stimulus approach. With bullish indicators like the RSI above 50, traders are positioning for a move toward the psychological level of 180.00. Buying call options with strike prices of 179.00 or 180.00 for December 2025 or January 2026 could be a good strategy to benefit from potential upward movement. However, it’s crucial to monitor the support at 178.00 closely. A drop below the nine-day EMA at 177.33 may signal a loss of strength and trigger protective measures. This could include purchasing put options with a strike price around 177.00 to hedge against rapid declines. It’s noteworthy that we are at significant levels, having surpassed peaks not seen since 2008. This breakout signals the start of a strong new trend. The yen’s continued weakness is also supported by recent data showing Japan’s Q3 GDP contracted by 0.2%, highlighting the fundamental differences. With the pair hitting record highs, increased volatility is expected, making options pricier. To manage these costs, traders might consider using bull call spreads—buying a call at a lower strike price and selling one at a higher strike price. This caps potential gains but significantly reduces initial premiums. Create your live VT Markets account and start trading now.

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