FxWirePro: NZD/JPY bears threat consolidation phase with shooting star and bearish engulfing patterns – Speculate via one touch binaries and short hedge

NZDJPY bears resume with bearish engulfing and shooting star in daily and weekly trend.

Engulfing pattern at 77.992 levels, shooting star at 77.655 levels (on the weekly chart).

Attempts of bull swings restrained below 7DMA on daily and 21EMA on weekly plotting, bearish EMA crossover with bearish pattern candle rightly placed at the resistance of 77.887 levels indicates weakness, consequently, current prices slid below EMAs (refer weekly chart).

NZDJPY price, volumes, leading and lagging indicators moving in tandem with bear swings.

While both leading & lagging indicator to substantiate bearish stance, MACD remaining in bearish trajectory does not substantiate this standpoint but this would be deemed as indecisiveness in current rallies.

RSI converges to the ongoing price dips as this leading oscillator trending below 50 levels which is an indication of strength in the downtrend, the same has been the case when you’ve to plot weekly charts, it signals weakness as it touched 47 levels.

We intensified bearish momentum in short term selling sentiments as stochastic oscillator evidences %D crossover right from the overbought zone.

While MACD on weekly terms indicates the prolonged downtrend.

Hence, we recommend shorting rallies on hedging grounds and decide to initiate shorts in futures contracts with near month tenor.

Well, at spot reference: 77.592, contemplating lingering bearish indications, on speculative grounds buying one touch binary puts would likely fetch leveraged yields, while on hedging grounds we recommend shorting near-month month futures as the underlying spot FX likely to target southwards 76.259 or below levels.

Writers in a futures contract are expected to maintain margins in order to open and maintain a short futures position.