NZD/JPY traded lower during the Asian morning Wednesday, after it hit resistance slightly below the 74.45 barrier. The slide brought the rate below yesterday’s low of 74.20, and was stopped near the 73.84 zone, also marked by the low of February 8th. On April 18th, the pair broke below the lower end of the sideways range that contained most of the price action since February 13th, and subsequently it continued drifting south. In our view, this paints a negative near-term outlook.
We believe that the bears are likely to take charge again soon and perhaps aim for another test near 73.84. If they manage to overcome that obstacle this time around, then we may see them driving the battle towards our next support territory, at 73.40, which is slightly above the low of January 22nd. That said, before the next negative leg, sellers could take a break and allow the rate to rebound somewhat further. A break back above 74.20 could confirm the case for a corrective bounce and may allow a test near the 74.45 level, or even the 74.65 zone.
Both the RSI and the MACD detect downside momentum and corroborate the case for another round of declines. The former lies below 30, while the latter stands below both its zero and trigger lines. However, the RSI shows signs of bottoming within its below-30 area, an indication upon which we base our view for a possible corrective bounce before the bears jump back into the action.
However, in order to abandon the bearish case, at least in the short run, we would like to see a move back above 74.90. Such a move would bring the rate back within the aforementioned sideways range and may initially aim for the 75.10 zone, the break of which could trigger extensions towards the crossroads of the 75.50 level and the downside resistance line drawn from the high of March 21st.
JFDBANK.com - One-stop Multi-asset Experience for Trading and Investment Services
The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. JFD Group, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD Group analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD Group prohibits the duplication or publication without explicit approval.
72,99% of the retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure: https://www.jfdbank.com/en/legal/risk-disclosure
Recommended Content
Editors’ Picks
AUD/USD risks a deeper drop in the short term
AUD/USD rapidly left behind Wednesday’s decent advance and resumed its downward trend on the back of the intense buying pressure in the greenback, while mixed results from the domestic labour market report failed to lend support to AUD.
EUR/USD leaves the door open to a decline to 1.0600
A decent comeback in the Greenback lured sellers back into the market, motivating EUR/USD to give away the earlier advance to weekly tops around 1.0690 and shift its attention to a potential revisit of the 1.0600 neighbourhood instead.
Gold is closely monitoring geopolitics
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Bitcoin price shows strength as IMF attests to spread and intensity of BTC transactions ahead of halving
Bitcoin (BTC) price is borderline strong and weak with the brunt of the weakness being felt by altcoins. Regarding strength, it continues to close above the $60,000 threshold for seven weeks in a row.
Is the Biden administration trying to destroy the Dollar?
Confidence in Western financial markets has already been shaken enough by the 20% devaluation of the dollar over the last few years. But now the European Commission wants to hand Ukraine $300 billion seized from Russia.