FxWirePro: AUD/JPY bulls restrained at 50% Fibos again, shooting star hampers momentum, upside upon breach above 87.587 – Construct tunnel spreads for trading

We see stiff resistance at peaks of 87.587 levels, historically, the rallies are hampered at these stiff resistance levels, where shooting star also evidences weakness at the same juncture.

One can bet on more dips upon slide below 7SMA levels.

To counter this bearish rout, the hammer pattern candles have occurred at the strong support of 86.019 levels and 87.246 levels (refer 4H charts), you could easily make out a strong bounce back at this level historically.

Likewise, hammer offers support to bulls, consequently, the current prices spike above 7SMAs with gaining momentum. But for now, rallies are restrained below 87.587 levels while both leading oscillators indicate selling interests.

On a broader perspective, bulls have managed to retrace 50% Fibonacci levels and bounce back above 7-EMAs levels in consolidation phase but struggling for momentum to sustain, uptrend likely to extend further only on breach above 87.587 levels as bullish EMA crossover to substantiate this bullish stance.

Most importantly, MACD has remained below zero level but no deviation from the buying sentiment indicates the uptrend is likely to extend further.

Trade Tips:

Well, contemplating above stated technical reasoning, on speculative grounds we advise buying tunnel spreads which are binary versions of the debit put spreads.

This strategy is likely to fetch leveraged yields than spot FX and certain yields keeping upper strikes at 87.500 and lower strikes at 87.250 levels.

Currency Strength Index: FxWirePro's hourly AUD spot index is inching towards 60 levels (bullish), while hourly JPY spot index was at shy above -76 (highly bearish) at the time of articulating. For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex.

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