EUR/JPY Forecast: Euro Faces Heat from French Politics but Holds Key Levels
The EUR/JPY pair is trading steady around 171.25 in early Europe, but the mood is tense as French politics takes center stage. The government is facing a critical vote of confidence, and investors are watching closely how the austerity debate unfolds. Any instability in Paris could shake market confidence and trigger fast moves in forex trading.
From a technical analysis view, the euro remains on the bullish side as long as it holds above the 100-day EMA. However, the RSI near 46 warns of possible bearish pressure. If bulls take charge, resistance is seen around 172.67, then 173.00 and 173.90. On the downside, a drop below 170.60 could drag prices to 170.00 and even 169.82, marking the August low.
Impact:
Political uncertainty in France may strengthen the safe-haven Japanese Yen and weaken the euro, pushing EUR/JPY lower. A break under 170.60 could invite stronger selling momentum in forex markets.
