FxWirePro: Doji to break NZD/JPY’s crucial support, next support seen at 79.444

The pair rallied from 75.181 to 81.897, it is now struggling to hold onto the crucial support at 80.750 levels. As shown on the daily charts, it has broken this level on intraday basis, you can observe how the price behavior of this pair on either side after breaching this level in the recent historical evidences (see circled areas).

More importantly, the formation of doji pattern candle at 81.099 levels (which is above mentioned support zone) signifies weakness in previous rallies, looks like bulls have exhausted and given up.

The RSI oscillator has begun diverging at around 70 levels which is overbought territory to the previous upswing rallies. This would mean that selling pressures are piling up.

Subsequently, %D crossover above 80's intensifies bears interests in the market, as a result we've seen today's lows at 80.261 to break the above support zone. Intraday prices are slipping below 10DMA which is again one more bearish indication. However, closing basis should be closely monitored.

If it does not manage to hold onto this level we could see near strong support only at 79.495 levels and at 74.500 levels. Even if it shows upside potential we would still be safe but medium term it has to drop back.

Although we've been observing some bounces we could see with a dubious eyes on Kiwi fundamentals which are not that conducive and hence, we maintain long term bearish trend in our opinion.