After initial retreat, EUR/JPY's rebound from 129.02 resumed towards the end of the week and reached as high as 131.96. Further rebound could still be seen initially this week. But after all, as rise from 129.02 is treated as a correction to fall from 135.47 only, we'd expect upside to be limited by falling trend line resistance (now at 133.89) which is close to 50% retracement of 138.70 to 129.02) to conclude. On the downside, below 130.83 minor support will turn intraday outlook neutral first. Break of 129.57 will argue that recent decline is resuming for 127.08 key support next. However, note that sustained trading above mentioned trend line resistance will dampen this view and argue that fall from 138.70 has already completed. Focus will turn shift to 135.47 resistance instead.
In the bigger picture, we're still favoring the case that medium term rebound from 112.10 has completed at 139.21 already, with bearish divergence condition in daily MACD and RSI, after failing to sustain above 55 weeks EMA. Break of 127.08 will confirm this case and target a retest of 112.10 low next. Also that price actions from 113.63 are treated as consolidation to long term decline from 169.96 only. Break of 127.08 will also argue that such consolidation has completed and indicates that the long term down trend is resuming too. We'll hold on to the bearish view as long as 135.47 resistance holds.
In the long term picture, the three wave corrective structure of the up trend from 88.96 (00 low) to 169.96 suggests that it's merely a correction to the multi decade down trend from 285.56. The impulsive nature of the fall from 169.96 indicates that it's likely resuming the down trend. And hence, such down trend is still expected to resume after completing the current medium term consolidation. In such case, we're looking at the prospect of a retest of 2000 low of 88.96. We'll maintain this view as long as 141.73 cluster resistance (50% retracement of 169.96 to 113.63 at 141.79) holds.