EURJPY TECHS: Trend Needle Points North

• RES 4: 177.08 2.000 proj of the Feb 28 - Mar 18 - Apr 7 price swing 
• RES 3: 175.43 High Jul 11 ‘24 and a key medium-term resistance
• RES 2: 174.86 1.764 proj of the Feb 28 - Mar 18 - Apr 7 price swing
• RES 1: 174.00 Round number resistance
• PRICE: 172.21 @ 19:43 BST Jul 28
• SUP 1: 171.47 20-day EMA
• SUP 2: 170.81 Low Jul 11
• SUP 3: 169.77 Low Jul 7  
• SUP 4: 168.76 50-day EMA   

The bullish trend condition in EURJPY remains intact, despite Monday’s sharp move lower. More broadly, the cross continues to appreciate. The early fresh cycle high this week maintains the positive price sequence of higher highs and higher lows. Note too that moving average studies are in a bull-mode position. Sights are on the 174.00 handle next. Support to watch lies at 171.47, the 20-day EMA. A clear breach of this average would signal scope for a corrective pullback. 

• RES 4: 151.21 High Mar 28
• RES 3: 150.49 High Apr 2 
• RES 2: 149.38 50.0% retracement of the Jan 10 - Apr 22 bear leg
• RES 1: 148.66/149.18 High Jul 21 / High Jul 16 and the bull trigger
• PRICE: 148.54 @ 19:42 BST Jul 28
• SUP 1: 146.76 20-day EMA
• SUP 2: 146.01/145.86 50-day EMA / Low Jul 24
• SUP 3: 145.16 61.8% retracement of the Jul 1 - 16 bull cycle
• SUP 4: 144.21 76.4% retracement of the Jul 1 - 16 bull cycle  

A bull cycle in USDJPY remains in place. Monday’s strong start to the week signals the end of the corrective pullback between Jul 16 - 24. Attention is on key resistance and the bull trigger at 149.18, the Jul 16 high. A break of this hurdle would confirm a resumption of the uptrend. Pivot support to monitor is 146.01, the 50-day EMA. A clear breach of it would instead signal scope for stronger reversal. First support is at 146.76, the 20-day EMA.    

The median expectation for 2025 rate cuts is 25bp, with a range of zero (including BofA, NatWest, and Scotiabank) further easing, to 100bp (UBS).

• Expectations are very much mixed for the timing of the resumption of easing, mostly split between September and December, but a few seeing October and some only next year.
• At least one sees a 50bp cut at a single meeting by year-end (Natixis, December).
• For analysts that have provided both a 2025 and 2026 rate outlook, the range of expectations for total cuts by end-2026 is 75-175bp with a median 112.5bp. Though this doesn’t include a few analysts who see no cuts in 2025 - implying that they see the Fed easing cycle already at an end.
• That said, the most total cuts are seen by Morgan Stanley (175bp, entirely in 2026), followed by Natixis, RBC, and TD (150bp each through end-2026).