EUR/JPY rebounded strongly to as high as 111.57 last week but lost momentum ahead of 111.93 cluster resistance (50% retracement of 123.31 to 100.74 at 112.02). Near term outlook is mixed and we'll stay neural first. On the downside, below 106.49 minor support will bring another fall to 104.74 support first. Break there will indicate that rebound from 100.74 is finished and the larger down trend is likely resuming for another low. On the upside, above 109.24 will flip bias back to the upside for 111.93 cluster resistance to extend the corrective rebound from 100.74.

In the bigger picture, while the rebound from 100.74 was strong, there is no signal of completion of down trend from 2008 high of 169.96 yet. Also such rebound is so far corrective looking and affirm the medium term bearish case. We'd continue to favor more downside in EUR/JPY for an eventual break of 100 psychological level towards 100% projection of 139.21 to 105.42 from 123.31 at 89.52, which is close to 88.96 all time low. However, sustained break of 55 weeks EMA (now at 112.25) will raise the odd of trend reversal and will turn focus back to 123.31 resistance for confirmation.

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. Hence, we'll look for reversal signal ahead of 88.96 low.

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