After edging higher to 111.93 initially last week, EUR/JPY reversed and dipped to as low as 108.85. The development suggests that consolidation from 108.01 has finished with three waves up to 111.93 already. Initial bias remains mildly on the downside for 108.01 first. Break will confirm resumption of the whole fall from 123.31 and should target 105.42/106.28 support zone. On the upside, above 109.88 minor resistance will delay the bearish case and bring more consolidations above 108.01. But after all, we'll stay bearish in the cross as long as 114.17 resistance holds and expect an eventual downside breakout.
In the bigger picture, rebound from 105.42 medium term bottom was merely a correction and has completed at 123.31 already. Whole down trend from 2008 high of 169.96 was not finished yet and should extend beyond 105.42. Also, as weekly MACD has broken its trend line, EUR/JPY is possibly regaining medium term downside momentum too. Break of 105.42 will target 61.8% projection of 139.21 to 105.42 from 123.31 at 102.42 first. Though, note that break of 123.31 resistance will in turn revive the case that the medium term trend has reversed and will turn focus back to 139.21 resistance instead.
In the long term picture, up trend from 88.96 (00 low) has completed at 169.96 and made a long term top there. Based on the five wave structure of the rise from 88.96 to 169.96, we're favoring that fall from 169.96 is corrective in nature. Current development raised the possibility that the 105.42 is not yet the bottom. In case of another fall, we'll continue to look for reversal signal ahead of 88.96 low.