EUR/JPY edged higher to 121.46 last week but retreated since then. Initial bias is neutral this week for some consolidations first. Downside of retreat should be contained above 191.11 support to bring another rally. On the upside, break of 121.46 will resume the rise from 115.86 to 161.8% projection of 115.86 to 120.01 from 117.07 at 123.78 next.
In the bigger picture, current development argues that a medium term bottom is formed at 115.86, on bullish convergence condition in daily MACD, ahead of 114.84 support. Decisive of 120.78 support turned resistance will affirm this case and bring further rise to falling channel resistance (now at 125.82). Reactions from there would decide whether the medium term has reversed. For now, further rise is expected as long as 117.07 support holds.
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. This falling leg would target 109.48 (2016 low). With EUR/JPY staying below 55 month EMA (now at 126.12), this is the preferred case.
