From the last couple of weeks, we kept urging for upside targets both fundamentally as well as technically (please refer to the below weblink for our previous write-ups):
The pair has now formed a gravestone pattern at 2.9954 levels but we don’t see any confirmation to this candle.
It has significantly bounced back after taking support at 2.9374 levels and has formed a gap candle too to boost our view.
Currently, the bulls have managed to break out above resistance levels of 2.9939.
One can easily make out the effects as and when it approaches the uptrend line. That’s where even evidences the strength in these sentiments.
The current prices on the weekly graph are well above EMAs that keeps having hopes ongoing upswings.
But on the flipside, since last September the pair has been struggling to continue the long-term robust trend, a sharp "shooting star" pattern candle formed at peak of 2.9466 on weekly charts and it has evidenced its effects in the H1 of 2016.
You can spot out the stiff resistance levels at 2.9824, 2.9939 levels that have been cleared convincingly, and next immediate resistance levels are seen at 3.01. We could foresee 3.06 mark with ease upon breach above 3.01 levels for now.
The major uptrend drifts in sideways from last more than a year or so, but bulls holding stronger even though the leading oscillators’ divergence is clearly visible, this evidences momentum wiping off and little weakness can be seen for the major trend. Hence, Friday’s gravestone shouldn’t be deemed as reversal without any clarity.
Trade tips: Keeping previous and prevailing swings in mind, we reckon one can deploy boundary binary options for targets across 50-60 pips on the intraday speculative basis.
Upper strikes – 3.01 (next immediate resistance); Lower strikes – 2.9833 levels (i.e. 7DMA), rewards certain if spot remains between these strikes on expiration.
The trading between these strikes likely to derive certain yields in this stiff range 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. 3.01 > Fwd price > 2.9833).
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