FxWirePro: 5-DMA caps upside in EUR/JPY, good to go short on rallies

• EUR/JPY recovery was rejected at 5-DMA at 124.09, the pair down over 0.80% on the day.
   
• The pickup in risk aversion providing extra support to the safe haven JPY. While EUR extends weakness ahead of ECB minutes.
   
• The ECB definitely has a potential to surprise and any hawkish tilt from the central bank could see spike in the pair.
   
• Technical indicators on daily charts have turned bearish after rollover from overbought levels.
   
• Bearish 'Anti Gartley' pattern on daily charts, adds downside bias.
   
• We recommend trading with tight stoploss ahead of major event risk (ECB).

Support levels - 122.59 (May 4 low), 122.56 (20-DMA), 122.25 (23.6% Fib of 114.85 to 124.53 rise)

Resistance levels - 124.07 (5-DMA), 124.54 (May 9 high), 124.65 (channel top & May 2016 high)

Recommendation: Good to go short on rallies around 123 levels, SL: 124, TP: 122.25/ 122/ 121.60

FxWirePro Currency Strength Index: FxWirePro's Hourly EUR Spot Index was at 3.10099 (Neutral), while Hourly JPY Spot Index was at 83.9531 (Bullish) at 0950 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.