EUR/JPY's Steep Decline Suggests Downside Bias Remains

The EUR/JPY currency pair experienced a significant decline last week, which suggests that it is already in its third leg of a specific pattern from 187.93. As a result, the initial bias remains on the downside this week for support at 180.78. A decisive break below this level would indicate that the pair is correcting its entire rise from 154.77 to 187.93, potentially leading to a deeper fall to the 38.2% retracement of that range at 175.26.

However, in the bigger picture, the uptrend from 114.42 (2020 low) is still expected to resume at a later stage and reach the 78.6% projection of 124.37 (2022 low) to 175.41 (2025 high) from 154.77 at 194.88.

Additionally, in the long-term picture, the up trend from 94.11 (2021 low) is ongoing with a target of 138.2% projection of 94.11 to 149.76 (2014 high) from 114.42 (2020 low) at 191.32.