The EUR/JPY has been moving sideways for a lengthy period of time. The correction could either be in wave 2 (pink) as indicated in the image, or price is still building a correction within an extended wave 1 (pink). The trend lines remain critical for the next direction: a bearish break below the support trend line (blue) could indicate a deeper wave 2 whereas a bullish break above the resistance trend lines (red) could indicate a wave 1 or 3 (pink).
EUR/JPY seems to have completed a bearish ABC (purple) correction. The wave C (purple) could be finished as long as price stays above the support trend line (blue) and eventually manages to break above the resistance zone. A bearish break, however, could indicate the start of a deeper wave 2 (pink). A bullish breakout could indicate a move up the Fibonacci targets of wave 3 vs 1 but keep an eye on the resistance level at 127.50, because that is where price could complete a wave 1 (pink) as well.
