To receive Michael’s analysis directly via email, please SIGN UP HERE
- NZD/JPY testing down-trend support after reversing off key resistance last month
- Check out our New 3Q projections in our Free DailyFX Trading Forecasts.
- Join Michael for Live Weekly Strategy Webinars on Mondays at 12:30GMT
NZD/JPY Daily Chart
Technical Outlook: NZD/JPY broke below pitchforksupport this week after reversing off key long-term resistance at 83.56/74. Note that this move also clears the July monthly range and keeps the focus weighted to the downside while below 81.67.
The decline is now testing the lower parallel of a near-term descending slope extending off the highs. Watch today’s close- a close below targets the 200-day moving average backed closely by the 50% retracement at 79.77.
Join Michael on Friday for his bi-weekly Live Webinar on the Foundations of Technical Analysis- Register for Free Here!
NZD/JPY 240min Chart
Notes: A closer look at price action highlights near-term support into 80.25 (6/21 swing lows) with interim resistance now eyed at 81.12. Broader bearish invalidation stands at the confluence of the July low, median-line and the 38.2% retracement at 81.63/67.
A break lower from here would likely see accelerated losses for the pair with such a scenario eying subsequent support targets at 79.77 & 79.37 & the 61.8% retracement at 78.79. From a trading standpoint, the immediate risk is for a near-term rebound off these levels but ultimately I’d be looking to fade a rally. Added caution is warranted heading into the Reserve Bank of New Zealand (RBNZ) interest rate decision later tonight with the release likely to fuel increased volatility in the Kiwi crosses.
See what sentiment is saying about Kiwi retail positioning - Click here to learn more about sentiment!
Relevant Data Releases
Other Setups in Play:
- EUR/JPY: Break of Monthly Opening Range to Offer Guidance
- Strategy Webinar: Dollar Rebound in Focus as Euro, Pound Risk Exhaustion
- USD/CAD Price Action Primed for NFP, Canada Employment
- GBP/JPY Back at Resistance Ahead of BoE’s Super Thursday
- Written by Michael Boutros, Currency Strategist with DailyFX
Follow Michael on Twitter @MBForex or contact him at firstname.lastname@example.org.