EUR/JPY edged higher to 121.96 last week but was rejected by 122.11 resistance reversed. The development suggests that corrective recovery from 119.31 has completed. Initial bias remains on the downside this week for 119.31 first. Break will resume the fall from 124.43 to 61.8% retracement of 114.42 to 124.43 at 118.24. On the upside, however, break of 122.11 will argue that fall from 124.43 has completed. Stronger rise would be seen to retest 124.43.
In the bigger picture, whole down trend from 137.49 (2018 high) could have completed at 114.42 already. Rise from 114.42 would target 61.8% retracement of 137.49 to 114.42 at 128.67 next. Sustained break there will pave the way to 137.59 (2018 high). This will remain the preferred case for now, as long as 55 day EMA (now at 119.90) holds. However, sustained break of 55 day EMA will revive medium term bearishness for another low below 114.42 at a later stage.
In the long term picture, EUR/JPY is staying in long term sideway pattern, established since 2000. Sustained break of 55 month EMA (now at 124.40) should confirm the start of another medium term rising leg.
