EURJPY Tests Key Support as BoJ Highlights AI as Yen Booster

The EUR/JPY currency pair is under pressure, testing the lower boundary of an ascending channel near 176.50. The 14-day Relative Strength Index (RSI) at 27.00 indicates oversold conditions, which could slow the decline but not reverse the bearish trend. The pair has been on a losing streak for seven consecutive days, trading around 176.70 during Asian hours on Monday.

Technical analysis suggests the pair could either hold support and bounce toward the channel's upper limits or break below 176.50, accelerating the downward momentum. The EUR/JPY is trading below key moving averages, including the nine-day EMA at 178.27 and the 50-day EMA at 181.34, signaling continued downside pressure. A break below 176.50 could target the 11-month low of 175.70, with further support at 169.72.

On the upside, resistance levels include the nine-day EMA at 178.27, followed by the 50-day EMA at 181.34, and the upper boundary of the descending channel around 184.40. The all-time high of 187.95, set on April 17, remains a distant target.

The Bank of Japan (BoJ) highlighted AI as a new positive demand shock for the Yen, framing it as a structural force that could justify tighter policy over time. BoJ's Uchida speech scored 7.2 on the FXS Speechtracker, signaling a stable tone rather than an escalation in policy urgency. The emphasis on AI's impact on economic activity, prices, and long-term rates tilts the message modestly hawkish for the Yen.