Daily Pivots: (S1) 126.44; (P) 127.96; (R1) 128.89;

EUR/JPY dropped sharply to as low as 126.59 before recovering mildly. The break of 126.88/127.50 support zone indicates that whole fall from 138.47 has resumed. Intraday bias remains on the downside and further decline should be seen to 124.35 support and then 100% projection of 138.47 to 126.88 from 134.36 at 122.77 next. On the upside, above 128.38 minor resistance will argue that a short term bottom might be in place on oversold condition and bring recovery. But upside should be limited below 131.25 support turned resistance and bring fall resumption.

In the bigger picture, the break of 126.88 support revives that case that medium term rebound from 112.10, which is treated as correction long term down trend from 169.96, has completed last year at 139.21. Break of 124.35 support will further affirm this case. By then, we'll be such long term down trend should be resuming for a new low below 112.10. On the upside, break of 134.36 resistance is needed to invalidate this case and suggest that rebound EUR/JPY is still consolidating rise fro 112.10. Otherwise, we'll stay bearish in the cross.