Will NZD/JPY Rebound Again Soon?

NZD/JPY traded lower on Friday, after hitting resistance at 80.20 on Thursday. On Wednesday, the pair returned back above the upside support line drawn from the low of March 24^th, and despite today’s slide, it remains above it. With that in mind, we would see decent chances for the bulls to take charge again at some point soon.

They could do so from near the 79.30 level, which is marked by yesterday’s low, or from near the prementioned upside support line. A rebound from near those areas may result in another test near the 80.20 territory, the break of which would confirm a forthcoming higher high and may see scope for extensions towards the 80.60 zone, defined as a resistance by the high of February 6^th, 2018.

Shifting attention to our short-term oscillators, we see that the RSI exited its above-70 zone and continues to point down, while the MACD, although positive, lies below its trigger line, pointing down as well. Both indicators detect slowing upside speed and support the notion for some more declines before, and if, the bulls decide to take charge again.

In order to start examining whether the bears have gained full control, we would like to see a decisive dip below 78.95. Such a move would also take the rate below the aforementioned upside line and may trigger declines towards the 78.50 zone, marked by an intraday swing low formed on May 25^th. If that zone is not able to stop the slide, then its break may pave the way towards the 77.97 barrier, which supported the price action between May 19^th and 24^th.

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