EUR/JPY Price Analysis: German PMI Data and Key Levels

EUR/JPY Technical Analysis and Price Forecast

The EUR/JPY pair is currently testing immediate support around the lower boundary of an ascending channel, positioned at 171.70. Short-term price momentum appears weak as the pair trades below the nine-day Exponential Moving Average (EMA).

The nine-day EMA, currently at 171.96, could act as initial resistance. EUR/JPY is stabilizing after a two-day decline, trading around 171.70 during the early European session on Thursday. This comes as the currency cross reacts modestly to the release of the HCOB Purchasing Managers’ Index (PMI) data from Germany and the Eurozone.

The HCOB Preliminary German Composite Output Index for August registered at 50.9, exceeding July's 50.6 and the expected 50.2. This marks a five-month high. Concurrently, the Manufacturing PMI improved to 49.9 from a previous 49.1, surpassing the market consensus of 48.8. However, the Services PMI dipped to 50.1, falling short of the anticipated 50.3 and the prior reading of 50.6.

Daily chart technical analysis suggests a potential shift from a bullish to a bearish market sentiment as the currency pair attempts to break below the ascending channel pattern. The 14-day Relative Strength Index (RSI) is slightly above the 50 mark, indicating that a bullish bias remains in play. Further price action will provide clearer directional signals. However, the short-term price momentum is subdued as EUR/JPY remains below the nine-day Exponential Moving Average (EMA).

A successful break below the ascending channel could trigger a bearish trend, potentially pushing EUR/JPY toward the 50-day EMA at 170.37, followed by the seven-week low of 169.72 recorded on July 31. Further declines could lead the pair to test the two-month low of 168.46, observed on July 1.

On the upside, immediate resistance lies at the nine-day EMA of 171.96, aligning with the psychological level of 172.00. A break above this critical resistance area would reinforce the bullish bias, potentially driving the pair towards 173.90, the highest level since July 2024, recorded on July 28, 2025, and subsequently towards the upper boundary of the ascending channel around 174.50.

Insights into Major Currency Movements

The tables provided show the percentage change of the Euro (EUR) against other major currencies. Notice that the Euro was the strongest against the Australian Dollar. This is valuable for traders looking to understand the relative strengths of different currencies in the market.

Important Note: This analysis is for informational purposes only and should not be considered investment advice. Forex trading involves significant risk and may not be suitable for all investors. Please conduct your own research and/or consult with a qualified financial advisor before making any investment decisions.