EUR/JPY dropped to as low as 102.75 last week as recent fall from 111.43 continued. The cross lost some momentum ahead of 61.8% retracement of 97.03 to 111.43 at 102.53 and turned sideway. With 4 hours MACD staying above signal line, initial bias is neutral this week for some consolidations. But upside of consolidations should be limited by 104.61 support turned resistance and bring another decline. Sustained trading below 102.53 fibo level will pave the way to retest 97.03 low. After all, near term outlook will remain bearish as long as 108.00 resistance holds.
In the bigger picture, current development suggests that EUR/JPY's down trend from 169.96 isn't completed yet and another low below 97.03 would be seen. But we're favoring the case that recent pattern from 139.21 is a falling wedge with bullish convergence condition in weekly MACD. Current fall from 111.43 should be the last leg in such pattern. And thus, the break of 97.03 support should be marginal and strong support is expected well above 88.96 to bring reversal eventually. Hence, while deeper decline could be seen, we'll look for bottoming signs as EUR/JPY breaks 97.03. Meanwhile, above 111.43 will revive the case that EUR/JPY has indeed bottomed and would turn outlook bullish.
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 argues that 97.03 might not be the bottom yet but reversal should be around the corner considering bullish convergence condition in monthly MACD.