Daily Pivots: (S1) 128.06; (P) 128.38; (R1) 128.98; More….
EUR/JPY’s strong rally today and firm break of 128.94 support turned resistance suggests that decline from 137.49 has completed at 124.61 already. The three wave structure in turn suggests that it’s a correction. And that larger rise is not finishe3d yet. Intraday bias in now on the upside for 131.34 resistance first. Break will target 133.47 key resistance next. On the downside, break of 127.78 support is now needed to indicate completion of the rebound. Otherwise, outlook will stay cautiously bullish in case of retreat.
In the bigger picture, as long as 124.08 resistance turned support holds, medium term rise from 109.03 (2016 low) is still in progress and another high above 137.49 would be seen. Nonetheless, considering bearish divergence condition in daily MACD, decisive break of 124.08 will confirm medium term reversal and target 61.8% retracement of 109.03 to 137.49 at 119.90 and below.
