EUR/JPY Price Forecast: Bulls Struggle at 187 Level Amid Intervention Concerns

EUR/JPY traded in a narrow range on Monday, with spot price at 185.60132, failing to mount an effective challenge on the key 187 resistance level above. Although the pair had previously approached this area, market vigilance over further intervention by Japanese authorities has notably intensified following coordinated US-Japan action, prompting cautious buying.

**Intervention Shadow Looms, Bulls Hesitant to Cross the Line**

Market participants' hesitation stems primarily from wariness over potential official intervention by Japan. According to a previous report by the UK's Financial Times, the US had taken coordinated action by selling euros and buying yen, with European authorities unaware of the move. This backdrop has made traders especially cautious in pushing the cross higher, fearing a new round of official pushback. While Japanese authorities have remained silent recently, market memory persists, and any tentative buying near the 187 level appears lacking in conviction.

**Technical Outlook Remains Bullish, But Momentum Capped**

From a technical standpoint, the Relative Strength Index (RSI) remains in bullish territory, suggesting the upside structure remains intact. However, the pair's continued confinement within the 186-187 range reflects fundamental concerns weighing on technical momentum. For bulls to regain upward traction, a decisive break and hold above 187 is needed; otherwise, profit-taking pressure may emerge.

**Outlook Focuses on Central Bank Policy and Risk Sentiment**

Looking ahead, the direction of EUR/JPY will hinge on multiple factors. On one hand, potential rate hike expectations from the Bank of Japan and safe-haven demand driven by global trade frictions continue to underpin the yen; on the other, the European Central Bank's policy path will also influence euro demand. In the absence of clear catalysts, the cross may continue to consolidate around current levels in the near term.