The euro continues to show relatively weak performance amid concerns over a potentially unbalanced trade agreement between the United States and the European Union. In addition, the market remains cautious ahead of key events related to central bank decisions scheduled for this week. These factors are supportive of the Japanese yen, which is considered a safe-haven currency, and they are putting some pressure on the EUR/JPY pair, contributing to its decline.

From a technical perspective, on the 4-hour chart, spot prices have moved below and consolidated under the 100-period simple moving average (SMA). Moreover, the oscillators on the same chart are in negative territory and remain far from oversold levels, confirming a short-term bearish outlook for EUR/JPY.

Furthermore, the pair has already broken below last week's low near the 171.35 level. As a result, further selling may leave the pair vulnerable to a drop below the key 171.00 level, opening the way for a test of the next support zone around 170.77.

On the other hand, any recovery attempt is likely to face resistance around the 172.25–172.30 level, followed by the 172.55–172.60 level near the 50-SMA. A sustained move above this latter range would allow EUR/JPY to break through the psychological level of 173.00 and continue rising toward the 173.25 mark. The upward momentum could then extend toward the yearly high around the key 174.00 level.

However, it is important to note that on the daily chart, oscillators have not yet entered negative territory. Therefore, bears should remain cautious, as the pair may not yet be ready for a broader downward trend.