FxWirePro: EUR/JPY minor trend spikes through rising channel, intermediate trend retraces 50% Fibonacci levels on hammer pattern but major trend still edgy

EUR is starting to stabilize following the succession of economic and political shocks that triggered the abrupt depreciation from late April.

Technically, EURJPY has been showing some sort of strength in upswings ever since the pair has bottomed from 129.620 levels.

Chart and candlestick pattern formed – Rising channel, shooting star and hanging man pattern candles at channel resistance (refer 4H chart). Consequently, you can make out sharp dips upon these bearish patterns.

Whereas, on weekly plotting, hammer patterns at 127.626 levels evidence rallies, spikes above 21EMAs and retraces above 50% Fibonacci levels of 2014 December highs & 2016 June lows, both leading & lagging indicators signal strength in upswings.

If you plot monthly chart, major downtrend still remains intact as leading oscillators signal bearish momentum as they converge downwards to the downswings.

Trade tips: On a medium-term trading perspective, at spot reference: 131.570 levels, it is advisable to buy 1m one-touch call option, use strikes at 131.987 levels, the strategy is likely to fetch leveraged yields as long as underlying spot FX keeps spiking further until expiry duration.

Currency Strength Index: FxWirePro's hourly EUR spot index is flashing at 8 levels (which is neutral), while hourly JPY spot index was at -84 (bearish) while articulating at 04:52 GMT. For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex