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EUR/JPY Pullback: What's Next After Hitting Yearly Highs? | Key Levels to Watch in Currency Cross

EUR/JPY Technical Snapshot: Bullish Momentum Faces Overbought Conditions

The Is XRP still worth investing?EUR/JPY currency cross has demonstrated notable strength in recent sessions, establishing fresh yearly highs before encountering resistance. As of Friday's Asian trading session, the pair consolidates near the psychologically significant 170.00 handle after retreating from Thursday's peak at 170.61.

Technical Indicators Present Mixed Signals

Market participants observe several conflicting technical factors influencing price action:

  • The ascending channel pattern remains intact, suggesting continuation of the prevailing uptrend
  • RSI readings near 70 indicate potential overextension, warranting caution for new long positions
  • Price maintains position above the nine-day EMA (169.39), preserving short-term bullish structure

Critical Price Levels for Traders

Several technical reference points merit attention in upcoming sessions:

Upside Potential: A decisive break above 170.61 could propel the pair toward channel resistance near 172.10, with momentum traders likely joining the move.

Support Zones: Initial downside protection emerges at 169.39 (9-day EMA), followed by the channel base around 167.50. A violation of the 50-day EMA (165.83) would signal potential trend reversal.

Market Sentiment and Positioning Considerations

The current technical setup presents traders with multiple scenarios:

  • Bullish continuation requires sustained buying pressure above 170.00
  • Overbought conditions suggest potential for profit-taking or mean-reversion strategies
  • Channel dynamics remain the dominant technical feature governing price action

Seasoned market participants typically monitor volume patterns and order flow around these technical levels for confirmation of potential breakout or reversal scenarios. The coming sessions should provide clarity regarding the pair's ability to sustain its upward trajectory or undergo a more substantial corrective phase.