EUR/JPY Price Forecast: Key downside target emerges near 160.00

• EUR/JPY trades in positive territory to around 160.75 in Friday's early European session.
• The cross keeps the negative view below the 100-period EMA with the bearish RSI indicator. 
• The key downside target to watch is 160.00; the immediate resistance level emerges near 161.90.

The EUR/JPY cross gains momentum to around 160.75, snapping the two-day losing streak during the early European session on Friday. The positive risk tone undermines a safe-haven currency like the Japanese Yen (JPY) against the Euro (EUR). However, the downside for the JPY might be limited as the hotter consumer prices in Tokyo keep hopes alive for further Bank of Japan (BoJ) policy tightening. 

According to the 4-hour chart, the bearish outlook of EUR/JPY prevails as the cross is below the key 100-period Exponential Moving Average (EMA). The downward momentum is reinforced by the Relative Strength Index (RSI), which stands below the midline near 40.70, supporting the sellers in the near term. 

The crucial support level for the cross is seen at 160.00, representing the psychological level and the lower limit of the Bollinger Band. Any follow-through selling below the mentioned level could see a drop to 159.11, the low of December 19, 2024. Further south, the next contention level to watch is 158.65, the low of December 11.

The first upside barrier for EUR/JPY emerges near 161.90, the 100-period EMA. A decisive break above this level could pave the way to 163.00, the upper boundary of the Bollinger Band. Extended gains could see a rally to the next hurdle at 164.08, the high of January 24. 

EUR/JPY 4-hour chart