EUR/JPY Jumps on Tariff Extension: Rally or Reversal Ahead?

EUR/JPY showed a nice jump after Trump extends tariff deadline until Jul 9th 2025. It hits an  intraday high of 162.97 and is currently trading around 162.64.  Intraday outlook is bearish as long as the resistance 165 holds.

The deadline for imposing a 50% tariff on EU goods was extended until July 9, 2025 by President Trump after European Commission President Ursula von der Leyen asked him to allow more time to finish trade negotiations. The ruling prevents the immediate risk of higher tariffs. Trump had previously considered imposing 20% tariff on goods from the EU, but later reduced it to 10% before threatening to increase it as high as 50% starting on June 1.

Technical Analysis:

The EUR/JPY pair is trading above    55 EMA,    200 and  365-H EMA  on the 4-hour  chart.

• Near-Term Resistance: Around 163  a breakout here could lead to targets at 163.70/164.20/165/166/166.65/167.
   
• Immediate Support: At 161.75 if breached, the pair could fall to  161.49/160.50/160/  159.25/158.85/158.25.
  
  Indicator Analysis 4-hour chart):
• CCI (50): Bearish
   
• Average Directional Movement Index: Neutral

Overall, the indicators suggest a mixed trend

Trading Recommendation:

It is good to  sell on rallies around 162.60-63 with stop loss at 163.10 for a TP of 160.