EUR/JPY Price Forecast: Crucial resistance level emerges near 174.50

• EUR/JPY drifts higher to around 174.00 in Monday's early European session.
• Positive view of the cross prevails above the 100-day EMA, with the bullish RSI indicator.
• The immediate resistance level emerges at 174.50; the first support level to watch is 173.51.

The EUR/JPY cross gains ground near 174.00 during the early European session on Monday. The Japanese Yen (JPY) strengthens against the Euro (EUR) as political uncertainty in Japan and economic headwinds stemming from US tariffs could give the BoJ more reasons to delay raising interest rates. The preliminary reading of Eurozone Consumer Confidence for September will be published later on Monday. 

Technically, the constructive outlook of EUR/JPY remains in place as the cross is well-supported above the key 100-day Exponential Moving Average (EMA) on the daily chart. The path of least resistance is to the upside, with the 14-day Relative Strength Index (RSI) standing above the midline near 61.05. This displays the bullish momentum in the near term. 

On the bright side, the key upside barrier emerges at 174.50, representing the upper boundary of the Bollinger Band and the high of September 19. Sustained trading above this level could pick up more momentum and aim for 175.43, the high of July 17, 2024. Further north, the next resistance level is seen at the 176.00 psychological level. 

In the bearish case, the low of September 18 at 173.51 acts as an initial support level for EUR/JPY. Any follow-through selling below the mentioned level could drag the cross toward 172.36, the low of September 11. The additional downside filter to watch is 171.27, the lower limit of the Bollinger Band.

EUR/JPY daily chart