EUR/JPY Price Analysis: Drops below Tenkan and Kijun-Sen, eyes 157.00

EUR/JPY holds losses of 0.19% on fundamental reasons while it remains subdued for ten consecutive days.
Upside risks remain, but are capped at around 158.17, 158.65 and 159.00.
Short-term, EUR/JPY is bearish biased, as price action tumbles below the Kumo.

The EUR/JPY remains subdued for the tenth-straight day, capped on the upside by the Kijun-Sen at 158.17, while the distance between the spot price and the Ichimoku Cloud (Kumo) shrinks, suggesting that downside risks are emerging. Hence, the cross-pair is trading at 1573.60, down 0.19%.

A fundamental reason behind the recent Euro (EUR) weakness is data showing the bloc is headed to a recession. At the same time, the European Central Bank (ECB) holds rates as fears of economic growth are tilted to the downside. Nevertheless, the ECB is adopting the Fed’s mantra of keeping rates higher for longer. That and fears that Japanese authorities could intervene in the Forex market and propel the Yen keeps traders parked on the sidelines.

The daily chart portrays the EUR/JPY trades sideways, with immediate resistance at the Kijun-Sen at 158.17. A breach of that level would expose the September 13 high of 158.65 before rallying to 159.00. Conversely, the pair’s first support would be the September 21 daily low of 157.03, followed by the top of the kumo at 156.86.

The hourly chart portrays the pair as neutral to downward biased, as it has achieved a successive series of lower highs, though it’s pending a lower low below September 21 at 157.03. In addition, the exchange rate is below the Kumo, while the Chikou Span sits below the price action and the Kumo, further confirming the bearish bias.

The EUR/JPY first support would be the daily low of today at 157.48, followed by last Friday’s low of 157.11. A breach of the latter would expose the 157.03, followed by the 157.00 figure. Conversely, the first resistance would be the Senkou Span B at 157.69, followed by the Tenkan-Sen’s confluence and the Kumo’s top at 157.79 before challenging 158.00.