EURJPY Price Analysis: Bullish Setup Targets 176.4 and 178.4
Muhammad Faraz 
EURJPY Price Analysis Bullish Setup Targets 176.4 and 178.4
EUR/JPY has recently pulled back from recent highs but remains structurally bullish. The pair is currently testing a strong support zone around 175.7, which has acted as a pivotal level in previous sessions. Our analysis projects a bullish recovery toward an initial target of 176.4 followed by 178.4, driven by support confluence and price action structure.
Current Market Structure and Price Action
The recent price structure of EUR/JPY remains bullish, characterized by a series of higher highs and higher lows on the H4 chart. After a sharp rally earlier this month, the pair is undergoing a technical correction, retracing into support.
Currently, the price is hovering near 175.7, where buyers have previously stepped in aggressively. The recent red candles indicate a healthy pullback rather than a structural reversal, setting the stage for a potential bullish continuation if the support holds.
Identification of the Key Support Zone
The 175.5–175.7 zone is highlighted as a strong support area, supported by:
- Historical Significance: This zone has acted as a pivot area multiple times in late September and early October.
- Technical Confluence: The area aligns with the previous breakout structure and local demand zone, strengthening its significance.
- Market Psychology: Buyers have consistently entered at this level, defending it as a value area for long positions.
This confluence suggests a high probability for a bullish reaction from this zone.
Technical Targets and Rationale
Our analysis identifies the following upside targets:
- Primary Target (PT1): 176.449
- Rationale: This level aligns with minor resistance formed during the previous correction. A break and hold above it would confirm bullish momentum resumption.
- Secondary Target (PT2): 178.456
- Rationale: This is a key resistance from the recent swing high and represents the upper boundary of the bullish continuation pattern. A move to this level would mark a full recovery from the correction phase.
Prediction: We expect EUR/JPY to hold above the 175.5–175.7 support area and climb towards PT1 at 176.4, and if momentum follows through, reach PT2 at 178.4 in the coming days.
Risk Management Considerations
A professional setup requires clear invalidation:
- Invalidation Level: A daily close below 175.00 would invalidate this bullish scenario, signaling potential deeper downside.
- Position Sizing: Traders should keep risk per trade limited (e.g., 1–2% of capital), with stops placed below structural support.
- Confirmation: Waiting for bullish candles or reversal patterns from support can enhance entry precision.
Fundamental Context
This bullish setup aligns with the broader market backdrop:
- Interest Rate Differentials: Ongoing monetary policy divergence between the ECB and BOJ continues to favor EUR strength against JPY.
- Risk Sentiment: Recent improvement in global risk appetite has supported EUR/JPY, often considered a risk-on pair.
- Economic Calendar: Upcoming Eurozone CPI data and BOJ comments may act as volatility catalysts.
Conclusion
EUR/JPY is at a technical inflection point, trading near a strong support zone. The price structure and confluence of technical factors suggest a bullish bias, targeting 176.4 as the first upside objective, followed by 178.4.
Traders should watch for confirmation signals around support and manage positions carefully, with 175.00 as the key invalidation level. A successful rally could set the tone for further bullish momentum in the medium term.
Chart Source: TradingView
Disclaimer: This analysis is for informational and educational purposes only and does not constitute financial advice. Trading and investing involve significant risk. Always conduct your own research and consult a financial professional before making trading decisions.
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