Daily Pivots: (S1) 130.33; (P) 130.69; (R1) 131.20; More….
EUR/JPY continues to gyrate in range of 129.34/132.40 and intraday bias remains neutral first. Overall, we’d expect upside of the consolidation to be limited by 38.2% retracement of 137.49 to 129.34 at 132.45 to bring fall resumption eventually. On the downside, decisive break of 129.34 will confirm resumption of whole fall 137.49 and target 126.61 medium term fibonacci level. However, firm break of 132.45 will target 61.8% retracement at 134.37 instead.
In the bigger picture, current development argues that rise from 109.03 (2016 low) has completed at 137.49, on bearish divergence condition in weekly MACD. Deeper fall should be seen to 38.2% retracement of 109.03 to 137.49 at 126.61 first. On the upside, break of 137.49 is needed to confirm medium term rise resumption. Otherwise, risk will now stay on the downside even in case of strong rebound.