Monday, January 27, 2020
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Technical Analysis – NZD/JPY overcomes 200-SMA

NZD/JPY overcomes 200-SMA; bullish crosses detected.

NZD/JPY’s upside correction overcame the 200-period simple moving average (SMA) on September 9 following a rebound on the newly formed base of 0.6670.

Despite the MACD and the RSI moving in bullish territory, both indicators have slowed down recently, suggesting that the rally may take a breather in the short-term. The implied decreasing positive momentum in the price is drawing some caution as bullish crosses have occurred between the 21- and 200-period SMAs, as well as between the 50- and 100-period SMAs.

If buying interest is revived over the resistance of 69.15, the bulls could move to test the 69.76 obstacle which is the 50.0% Fibonacci retracement level of the down leg from 73.23 to 66.30. Thrusting higher, the 70.25 level could hinder a further climb to encounter the 61.8% Fibo of 70.57 before 71.50 can play out.

If the bears manage to pull the price back below the 68.95 support, which is the 38.2% Fibo, the price could initially stall in the crossroads of the 21- and 200-period SMAs before testing the 23.6% Fibo of 67.93 and the 50-period SMA. Lower, if the 67.55 support gives way, traders could shift focus towards the 66.70 level of lows and the eighty-one-month low of 66.30.

Overall the short-term picture is bullish, and a close above 70.57 would confirm it. A drop under the 200-period SMA would resume a neutral-to-bearish outlook.


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This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

Source: XM

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