NZD/JPY Price Analysis: Pair surpasses 98.00, establishing new cycle highs
- NZD/JPY resumes its bullish trend, surpassing 98.00 mark and hitting new cycle highs.
- Immediate supports identified at 97.50 and 97.00 markers represented by 20-day SMA in case of potential corrections.
- As the pair rides uncharted terrain it might test the 99.00-100.00 range.
On Wednesday, the NZD/JPY pair resumed its upward trajectory, an extension of the bullish trend noted in the previous week. Even as a strong bullish drive emerges as the predominant force, there is caution regarding a potential correction as indicators reflect overbought conditions. In the session, the pair rose by 0.60% to reach 98.70, a fresh cycle high.
In terms of the daily chart's analysis, the Relative Strength Index (RSI) has increased, now sitting in overbought territory at a reading of 75, up from Tuesday's reading of 68. This points to increasing market momentum. However, this climb incurs the risk of a potential pullback given these heightened overbought conditions. The Moving Average Convergence Divergence (MACD) presents green bars, also adding arguments to the overextended movements.
NZD/JPY daily chart
Immediate support in case of a downward correction is now speculated around the 97.50 and 97.00 markers, represented by the 20-day SMA. Buyers should concentrate on maintaining these levels prior to reaching newer peaks. Potential for advancements around 98.80, 99.00, and even 100.00 windows are within sight, following a successful defense of the 97.00 level.
Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
