FxWirePro: AUD/JPY bulls likely to break-out stiff resistance as bullish crossover on SMAs and leading oscillators substantiate but short term bearish

AUDJPY has all chances of break out the stiff resistance at 79.840 levels.

From last three-four weeks, the current prices have been spiking above SMAs with 7WMA crossing over 21WMA on weekly terms.

The interim uptrend confirmed by both leading and lagging indicators on weekly charts, leading oscillators are also converging to these price gains.

RSI shows the strength in the ongoing rallies, whereas, stochastic curves approach overbought zone but with still %K crossover. MACD signals the extension of bull swings in the medium run.

On the contrary, intraday (4H) and EOD charts signal the short term weakness at 200DMAs, while RSI evidencing divergence to the recent rallies.

On a broader perspective, you can figure out from the monthly plotting, the current prices hitting 3-months highs but still the prices have consistently remained well below EMAs but now shown a little strength to break above 7EMA. Current prices on monthly terms are at the same juncture now (7EMA) sensing the stiff resistance.

Consequently, every attempt of recovery has been showing weakness at these MA curves which would be deemed as the strong supply zones.

To understand the major downtrend, last month, during the convincing rallies of AUDJPY bears pulled back at 77.506 mark (strong resistance at 79.837 levels), but any break-out above ensures the consolidation pattern, thereby, intermediary bulls can bet upon further rallies.

Trade Tips:

Contemplating the above technical reasoning, we think boundary binary options are the right choice of speculation for the day that optimally utilizes the bullish sentiments in the short term and the major downtrend.

Upper strikes – 80.028; lower strikes around 79.5313 levels.

The trading between these strikes likely to derive certain yields in this puzzling trend and more importantly these yields are exponential from spot FX.

For cash or nothing, these options would be exercised if the forward prices to remain between both strikes (i.e. 80.028 > Fwd price > 79.5313).