NZD/JPY Price Analysis: Struggles around 76.60 amid a risk-on market sentiment

The NZD/JPY advances as the Asian Pacific session begins, trading at 76.60 during the day at the time of writing. On Monday, the market sentiment was upbeat, with US equity indices posting gains between 0.85% and 2.06%, amid positive news from South Africa. Although highly contagious, the omicron variant’s cases are mild compared to previous COVID-19 strains. 

On Monday, the NZD/JPY climbed steadily from low 76s towards the 50-hour simple moving average (SMA) around the 76.60 area, where it settled. Nevertheless, it failed to gain traction towards the 100-hour SMA at 76.87, a level that, once broken, could’ve accelerated an upward move towards 77.00. 

NZD/JPY Price Forecast: Technical outlook

The NZD/JPY pair has a downward bias in the daily chart, depicted by the daily moving averages (DMA’s) with a flattish slope, residing above the spot price. Furthermore, bulls are probing the confluence of the November 30 low and an upslope trendline of the previous support-turned-resistance around 76.65. In the outcome of a break above that level, it would expose crucial supply zones, like the December 3 high at 77.17, followed by the downslope trendline around 77.25-40. A breach of the latter would expose the confluence of the 200-day moving average (DMA) and the psychological 78.00 figure.

On the other hand, if the NZD/JPY extends its previous losses, the first support would be December 3 low at 79.95. A break under that level could send the cross-currency tumbling towards the August 19 low at 74.55.