EUR/JPY Price Forecast: Strengthens above 171.50, further consolidation cannot be ruled out

• EUR/JPY strengthens to around 171.85 in Wednesday's early European session. 
• Positive outlook of the cross prevails above the 100-day EMA, but further consolidation looks favorable with the neutral RSI indicator. 
• The immediate resistance level is seen at 172.67; the initial support level is located at 171.12.

The EUR/JPY cross gains traction to near 171.85 during the early European session on Wednesday. The Japanese Yen (JPY) softens against the Euro (EUR) amid the improved risk sentiment, which undermines the safe-haven currency. Investors await a series of economic reports that could shape expectations for Bank of Japan (BoJ) policy. Japan's Tokyo Consumer Price Index (CPI) for August is due later on Friday. 

Technically, EUR/JPY keeps the bullish vibe on the daily chart, with the price holding above the key 100-day Exponential Moving Average (EMA). However, further consolidation or temporary sell-off cannot be ruled out as the 14-day Relative Strength Index (RSI) hovers around the midline. This suggests the neutral momentum in the near term. 

The first upside target to watch for the cross is seen at 172.67, the high of August 25. Extended gains could see a rally to 173.00, representing the upper boundary of the Bollinger Band and round mark. Further north, the next hurdle is located at 173.90, the high of July 28. 

On the other hand, the initial support level for the cross emerges at 171.12, the low of August 20. A breach of this level could expose 170.65, the lower limit of the Bollinger Band. The additional downside filter to watch is the 170.00 psychological level. 

EUR/JPY Daily Chart