By: Doug Rosen
See how this EUR/JPY technical analysis was implemented on a binary actions platform.
Starting out with the weekly chart bullish conditions exist. The stochastic is crossing it's way out of the oversold zone and price is trying to catch a ride on the 5 ema. Moving on to the daily chart price has finally succeeded in breaking a descending trend line that has held up a few times in the past. The 5 ema has also made its way north of the trend line and the stochastic is prepping to make a bullish cross from within the overbought zone, a very bullish indication. The upper Bollinger band is open and pointing up and the 13 ema has crossed above the 21 ema. Moving on to the 4 hour chart, the upper Bollinger band is also looking very bullish as is the 5 ema crossing above the other ema's. Price is fighting with the monthly R2 but I have a feeling it will break and won't look back. Price has just broken above the weekly Central Pivot Point and is retracing just a bit. I expect price to retest the weekly central pivot which overlaps with the 5 ema then should continue onward.
I do want to point out however, that the hourly stochastic is in the overbought zone and many traders may see what could be interpreted and actually is a double top. also, looking at the USD/JPY the JPY is stronger and resistance may not be so easy to crack with this pair so do not look for longs on this pair unless you see green at around 106.04 and if price is between 106.04 and 106.69 be very careful because this is a critical zone and further continuation to the upside will not be confirmed until we bust 106.70 which is the weekly M3.
Finally, looking at the 15 minute chart price is looking very toppish around the semi-psychological level of 106.50 which also happens to be just above the daily R1 at 106.44 and the stochastic is pointing sharply downward. Stochastic will probably recycle itself and be back in the oversold zone pointing up soon and price should make it's way down to the 21 or 55 ema before it continues upward. Be careful trading this pair tonight since it could go either way. If taking Longs wait for a fib overlapped with an ema or pivot point of some type with a tight stop loss. If looking for shorts, wait for a couple series of lower highs and lower lows after price breaks below the daily central pivot point at 105.65.
