EUR/JPY recovered to 98.80 last week but upside was limited by 4 hours 55 EMA and the cross then dipped sharply. The break of 97.27 support in the end suggests that recent fall is resuming. Initial bias is on the downside this week for 61.8% projection of 102.53 to 97.27 from 98.80 at 95.54 next. On the upside, break of 98.80 resistance is needed to signal short term bottoming. Otherwise, near term outlook will remain bearish even in case of recovery.
In the bigger picture, EUR/JPY's downside momentum is accelerating with a break of lower trend line in weekly chart and with weekly MACD staying below signal line Current fall from 123.31 is part of the downside from 2008 high of 169.96 and should target 100% projection of 139.21 to 105.42 from 123.31 at 89.52. At this point, we'd anticipate strong support there to bring at least a rebound attempt, as it's close to 88.96 all time low as well as100% projection of 123.31 to 100.74 from 111.57 at 89.00. Though, a break of 111.57 resistance is needed to be the first signal of reversal. Otherwise, we'll continue to stay bearish in the cross even in case of rebound.
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.