(Typo corrected)

By Justin McQueen

April 30 (Reuters) - The euro continues to hold its ground, bouncing off the 200-day MA yet again. Though resilient, spot has yet to break out of recent ranges. The weekly high at 1.1754 remains untouched, which needs clearing to shift the tone.

The real story today is JPY. Aggressive USD/JPY selling has done the heavy lifting for the euro, EUR/USD has essentially been a passenger. Intervention was confirmed by government sources, which is mildly interesting.

This feels like a tactical shift under Finance Minister Satsuki Katayama. Under former FX Chief Masato Kanda's framework, one market interpretation was that the trigger was a 10 yen move in a month, 4% in two weeks.

The latest episode appears different. USD/JPY was pinned in the 158-159 range since mid-March, and shortly after it poked above 160, officials stepped in. So, the market may conclude that levels matter now, not velocity, with 160 now likely a ceiling for the time being.

If so, that could somewhat limit the downside for EUR/USD by extension.

The European Central Bank were marginally more hawkish than the last meeting, but with a June hike fully priced, President Christine Lagarde had a high bar to out hawk the market.

Source reports post-meeting were clear: the discussions on policy was not if they hike, but appeared focused on when and by how much they ultimately tighten. The broader question though is whether hiking into a supply shock is actually currency-positive and the jury is still out on this one. Eventually it pulls forward the anticipated demand hit.

Technically, the level to watch is still the 200-day MA. While it continues to hold, repeated tests increase the risk of a clean break, and a flush below opens up 1.1600. To the topside, 1.1754 is the near-term pivot. Through here convincingly and 1.1830 (July 2025 high) becomes the next focal point.
USDJPY vs EURUSD


Justin McQueen is a Reuters market analyst. (The views expressed are his own) ((Email: ))