EUR/JPY Price Analysis: Clashes strong support, around 157.50 as bears loom
- EUR/JPY is diving almost 3% since November 27, when the pair hit a high of 163.72
- The downtrend remains intact, though it could accelerate further with a drop below 157.55.
- If EUR/JPY buyers reclaim 159.00, that could pave the way for gains.
The EUR/JPY extends its losses for the seventh straight day and hovers just above the top of the Ichimoku Cloud (Kumo), at around 158.89, down by 0.36% daily after reaching a daily high of 159.71. The main drivers behind the move have been market sentiment shifting sour, favoring appetite for the safe-haven status of the Japanese Yen (JPY), which appreciated against most G8 FX currencies, except for the Greenback.
EUR/JPY downtrend remains intact even though it bottomed at around 158.50s, which could open the door for some consolidation as bears take a respite. Nevertheless, the crossing of the Tenkan-Sen below the Kijun-Sen, along with the Chikou Span shifting bearish, means the Euro (EUR) is not out of the woods.
Given the backdrop, the EUR/JPY first support is the top of the Kumo at around 158.40/50. A decisive break could drag prices toward the bottom of the Kumo at 157.55, which, once taken out, would cement the pair’s bearish bias. The next demand area would be a support trendline at around 157.00, followed by the October 3 swing low of 154.34.
On the other hand, if buyers reclaim 159.00, that could pave the way for a recovery toward the confluence of the Senkou Span A, and the Tenkan and Kijun-Sen at around 161.13/20.
EUR/JPY Price Analysis – Daily Chart
EUR/JPY Technical Levels
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
