EUR/JPY Price Analysis: Bounces from cloud’s edge, reclaims 157.00

Intervention hesitations by Japanese authorities refrained EUR/JPY bulls from entering the market.
If EUR/JPY pierces the two-week support trendline, the pair might drop inside the Kumo.
Short-term, the pair remains bearish, with their sight set at 156.00.

The EUR/JPY dropped towards the top of the Ichimoku Cloud (Kumo) at around 156.80 but jumped off that level and reclaimed the 157.00 figure as the Asian session began. The EUR/JPY prints minuscule losses of 0.06%, exchanging hands at around 157.02.

The daily chart shows the pair is extending its consolidation, but it briefly broke below a two-week low support trendline, which exacerbated a fall beneath 157.00. However, key support levels keep the EUR/JPY underpinned for higher prices. Still, threats of Japanese intervention in the Forex markets refrain bulls from opening fresh bets and break to a new cycle high, above the September 13 daily high at 158.65. Conversely, if EUR/JPY slips inside the Kumo, the first support would be the Senkou-Span B at 155.58, followed by the bottom of the Kumo at 155.20.

From an intraday perspective, the EUR/JPY hourly chart showed the pair is set to extend its losses, but it remains near yesterday’s lows. A breach of the lows at 156.95 could pave the way to test the September 15 swing low at 156.72, followed by the September 14 daily low of 156.64. Once those levels are cleared, the next stop would be 156.00.