EUR/JPY’s down trend resumed last week and hit as low as 114.42. As a temporary low was formed, initial bias stays neutral this week first. Some consolidations might be seen but upside should be limited well below 117.77 resistance to bring another decline. On the downside, break of 114.42 should target 161.8% projection of 122.87 to 116.12 from 121.14 at 110.21 next.
In the bigger picture, the down trend from 137.49 (2018 high) is still in progress. EUR/JPY continues to stay well inside falling channel and below falling 55 week EMA. Deeper fall could be seen to retest 109.48 (2016 low) next. On the upside, break of 122.87 resistance is needed to confirm medium term bottoming. Otherwise, outlook will stay bearish in case of rebound.
In the long term picture, EUR/JPY is staying in long term sideway pattern, established since 2000. Fall from 137.49 is seen as a falling leg inside the pattern. This falling leg would target 109.48 (2016 low). With EUR/JPY staying below 55 month EMA (now at 124.57), this is the preferred case.