EUR/JPY Mid-Day Outlook

Daily Pivots: (S1) 133.34; (P) 136.34; (R1) 137.91; More.

As discussed before, EUR/JPY's rebound from 132.19 should have completed at 141.73. At this point, intraday bias remains on the downside as long as 138.96 minor resistance holds. Further decline should be seen to retest 132.19 low first. Break will confirm recent down trend has resumed for next long term fibonacci level at 129.46 (50% retracement of 88.97 to 169.96). On the upside, though, above 138.96 will suggest that consolidation from 132.19 is still in progress for another test of 141.73 before completion. But still, upside should be limited below 147.03 resistance and bring down trend resumption.

In the bigger picture, the sharp fall from 169.96 is still in progress and has taken out long term fibonacci level of 38.2% retracement of 88.97 to 169.96 at 139.02 without hesitation. The development so far suggests that fall from 169.96 is developing into a five wave decline and EUR/JPY is probably in the middle of it only. Medium term outlook will remain bearish as long as 147.03 support turned resistance holds and another fall is still expected even in case of correction, targeting 61.8% retracement of 88.97 to 169.96 from at 119.90. Though, break of 147.03 will dampen this view and argue that fall from 169.96 has possibly completed.

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