EUR\/JPY traded near 184.35 in early European dealings on Tuesday. Tensions between the US and Iran may support the safe-haven Japanese Yen and limit gains.<\/p>\n
The Euro may find support from a hawkish ECB tone. Markets are pricing in 2\u20133 interest rate rises for 2026 as energy-led inflation increases.<\/p>\n
On the daily chart, EUR\/JPY keeps a mild upward bias above the rising 100-day EMA near 182.10. It also sits above the Bollinger middle band around 183.70, with RSI at 55.22 and trending higher.<\/p>\n
Support levels are seen at 183.70, then 183.00, with deeper support at the 100-day EMA near 182.10. Resistance is near 185.80, and a break above it may allow a move towards 186.30.<\/p>\n
The Yen is influenced by Japan\u2019s economic performance, Bank of Japan policy, yield gaps versus the US, and risk sentiment. The BoJ used very loose policy from 2013 to 2024, then began to unwind it in 2024, which has helped narrow the 10-year US\u2013Japan yield gap.<\/p>\n
In risk-off markets, the Yen often strengthens as funds move towards perceived safer assets. The BoJ has intervened at times, usually to weaken the Yen, but does so infrequently.<\/p>\n
We see a fundamental conflict for EUR\/JPY, with a hawkish European Central Bank providing support against geopolitical risks that could strengthen the yen. With Eurozone core inflation persisting above target at 3.1% in the March 2026 reading, the market is solidifying bets on at least two ECB rate hikes this year. This policy divergence from the Bank of Japan underpins the euro’s strength.<\/p>\n
For traders aligned with the bullish trend, buying call options on dips towards the 183.70 level appears to be a sound strategy. The technical picture supports further upside towards the 185.80 resistance zone in the coming weeks. Using options allows for defined risk while targeting this upward momentum driven by ECB policy.<\/p>\n
However, we must consider the yen’s role as a safe haven, particularly with ongoing US-Iran tensions. Reports last week of a close encounter between naval vessels in the Strait of Hormuz serve as a reminder of how quickly sentiment can shift. As we saw during similar risk-off events in 2025, capital can flow rapidly into the yen, creating sharp downward moves.<\/p>\n
To manage this risk, purchasing protective put options with a strike price near 183.00 could be a prudent hedge for any long positions. For those anticipating an escalation, these puts offer a direct way to profit from a flight to safety. A daily close below this psychological level would signal that the bullish momentum is fading.<\/p>\n
It is also important to remember the Bank of Japan’s gradual policy normalization since 2024, which has provided a stronger floor for the yen than we saw in previous years. The yield differential between German and Japanese 10-year bonds, while still wide at approximately 2.1%, has narrowed from its peak in late 2025. This structural change means the yen may react more robustly to risk-averse catalysts.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" EUR\/JPY hovers near 184.35; US-Iran tensions boost Yen, while hawkish ECB supports Euro upside.<\/p>\n","protected":false},"author":103,"featured_media":17043,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-46794","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/46794","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/103"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=46794"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/46794\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/17043"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=46794"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=46794"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=46794"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}