Daily Pivots: (S1) 127.55; (P) 128.21; (R1) 128.71; More….
With 129.05 minor resistance intact, deeper fall is expected in EUR/JPY for 126.61 medium term fibonacci level. We’ll be looking for strong support from 126.61 to contain downside and bring rebound. On the upside, above 129.22 support turned resistance is the first sign of short term bottoming. In that case, bias will be turned back to the upside for 131.34 resistance first.
In the bigger picture, for now, price actions from 137.49 are viewed as a corrective pattern only. Hence, while deeper decline would be seen, strong support is expected at 38.2% retracement of 109.03 to 137.49 at 126.61 to contain downside and bring rebound. Up trend from 109.03 (2016 low) is expected to resume afterwards. Though, sustained break of 126.61 will be an important sign of trend reversal and will turn focus to 124.08 resistance turned support.
