EUR/JPY’s rebound from 123.65 extended to as high as 125.50 last week but lost momentum since then. Initial bias is turned neutral this week first. Current development argues that corrective pull back from 127.50 might have completed already. Hence, further rise is expected as long as 124.47 minor support intact. On the upside, above 125.50 will turn bias to the upside for 126.78/127.50 resistance zone. However, on the downside, break of 124.47 will turn bias back to the downside for 123.65 support instead.
In the bigger picture, EUR/JPY is staying well inside medium term falling channel from 137.49 (2018 high). It’s also held below 55 week EMA (now at 127.53). Thus, down trend from 137.49 might still extend lower. Break of 118.62 will target 109.03/114.84 long term support zone. On the upside, however, break of 127.50 will solidify the case of medium term bullish reversal. Rise from 118.76 should extend to 133.12 key resistance instead.
In the long term picture, EUR/JPY is staying in long term sideway pattern, established since 2000. Fall from 137.49 is seen as a falling leg inside the pattern. Break of 118.62 will extend this falling leg through 109.03 low. On the upside, break of 133.12 resistance bring retest of 149.76 (2014 high).
