EUR/JPY’s retreat from 178.80 extended lower last week but recovered after hitting 175.67. Initial bias stays neutral this week and risk will remain mildly on the downside as long as 178.80 resistance holds. Break of 175.67 will target 55 D EMA (now at 175.00). Considering bearish divergence condition in D MACD, sustained break of 55 D EMA will argue that EUR/JPY is correcting whole rise from 154.87, and target 169.69 cluster (38.2% retracement of 154.77 to 178.80 at 169.69). Nevertheless, firm break of 178.80 will resume the long term up trend.
In the bigger picture, up trend from 114.42 (2020 low) is in progress and should target 61.8% projection of 124.37 to 175.41 from 154.77 at 186.31. However, firm break of 174.80 support will suggests that it has turned into consolidations first. But still, outlook will continue to stay bullish as long as 55 W EMA (now at 168.20) holds, even in case of deep pullback.
In the long term picture, up trend from 94.11 (2021 low) is in progress. Next target is 138.2% projection of 94.11 to 149.76 (2014 high) from 114.42 (2020 low) at 191.32. This will remain the favored case as long as 154.77 support holds.
. Considering bearish divergence condition in D MACD, sustained break of 55 D EMA will argue that EUR/JPY is correcting whole rise from 154.87, and target 169.69 cluster (38.2% retracement of 154.77 to 178.80 at 169.69). Nevertheless, firm break of 178.80 will resume the long term up trend.){kind=link}