After some intraday week consolidations, EUR/JPY's fall from 114.72 extended further to as low as 108.24 support. The development is so far inline with our view that corrective rise from 107.30 is finished at 114.72 already after failing to sustain above 55 days EMA. Initial bias will remains on the downside for 107.30 low first and break will target medium term projection level at 103.45 next. On the upside, above 110.44 resistance is needed to signal short term bottoming. Otherwise, outlook will remain bearish.
In the bigger picture, whole fall from 139.21 is viewed as resumption of long term down trend from 2007 high of 169.96 and is still in progress. Fall from 114.72 is tentative treated as resuming of such down trend and should target 61.8% projection of 169.96 to 112.10 from 139.21 at 103.45 which is close to 100 psychological level after taking out 107.30 low. Though, we'd expect strong support between 2000 low of 88.96 and 100 psychological level to contain downside and bring reversal. On the upside, break of 114.72 resistance will now be an early alert of medium term reversal and will turn focus back to 119.64/127.88 resistance zone for more evidence.
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. It should develop into a three wave correction with first wave completed at 112.10, second wave completed at 139.21. The third falling leg is now in progress but would be contained above 88.96 key support level. We'll hold on this this view unless fall from 169.96 shows sign of acceleration.