FxWirePro: USD/JPY hammer takes-off rallies above DMAs, major trend likely to display dragonfly doji but struggles for momentum

A Glance at Technical Analysis: 

• The USDJPY minor trend, forms hammer patterns (on both daily and monthly terms) that take off rallies above DMAs, while both leading & lagging oscillators indicate strength in upswings, more rallies likely on bullish momentum. 
• Hammers have occurred at 107.656 (on daily) and at 103.421 & 106.260 levels (on monthly terms).
• On the flip side, the major trend has been in the consolidation phase now seems to be exhausted below EMAs, more rallies likely in the minor trend but. Hammer pattern has occurred at 106.260 levels, ever since then the minor price trend has been oscillating between range-bounded trend, hanging man has occurred at 112.942 levels. we see bullish invalidation on retrace below 109.257 levels.
• Well, we see stiff resistance at 110.9603 – 111.400 levels and strong supports at 109 levels.
• On major trend, bulls seem to be exhausted at 61.8% Fibonacci levels from the lows of June 2016, (refer monthly plotting), the trend on this timeframe, is stuck in a tight range. As a result of minor rallies in the recent past, from the lows of 104.656 levels have created the hopes of most likely pattern of dragonfly doji in this month but this bullish pattern is not to be isolated as the leading indicators signal overbought pressures.

Trade Tips: Contemplating above technical rationale, it is wise to bid tunnel spreads with upper strikes at 109.950 and lower strikes at 109.0070 levels. The strategy is likely to fetch leveraged yields as long as the underlying spot FX keeps dipping but remains well above lower strikes on the expiration.

Currency Strength Index: FxWirePro's hourly USD spot index was at 84 (which is bullish), while hourly JPY spot index was at -37 (bearish) at 06:20 GMT. 

For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex