EUR/JPY trades with modest intraday gains, remains below 162.00 mark

• EUR/JPY struggles to attract any meaningful buying amid mixed fundamental cues.
• The BoJ uncertainty and the risk-on mood undermine the JPY and lend support.
• Bets for a more aggressive ECB rate cuts cap any meaningful upside for the cross. 

The EUR/JPY cross kicks off the new week on a positive note, albeit struggles to capitalize on its intraday move up and remains below the 162.00 mark through the Asian session. Moreover, the fundamental backdrop suggests that the path of least resistance for spot prices is to the downside. 

Investors now seem convinced that increased domestic political uncertainty in Japan could restrict the Bank of Japan (BoJ) from hiking interest rates further. This, along with the prevalent risk-on environment, is seen undermining demand for the safe-haven Japanese Yen (JPY) and lending some support to the EUR/JPY cross. That said, intervention fears and retreating US Treasury bond yields help limit losses for the lower-yielding JPY.

The shared currency, on the other hand, seems vulnerable on the back of a surprise fall in the Eurozone Composite PMI to a 10-month low in November. This comes on top of potential economic risks in the wake of US President-elect Donald Trump's taunted tariffs and lifts bets for faster interest rate cuts from the European Central Bank (ECB). This, in turn, favors the Euro bears and validates the negative outlook for the EUR/JPY cross. 

Even from a technical perspective, the recent repeated failures near the 200-period Simple Moving Average (SMA) on the 4-hour chart favor bearish traders. Adding to this, negative oscillators on daily/hourly charts suggest that any intraday move-up could be seen as a selling opportunity and runs the risk of fizzling out quickly. Investors, however, might wait for acceptance below the 161.00 mark before positioning for any intraday decline.