- NZD/JPY trades 0.47% lower on the day, at 74.56 at the time of writing.
- The pair has broken major trendline support at 74.80, bias remains bearish.
- Kiwi remains under pressure after the Reserve Bank of New Zealand (RBNZ) kept the overnight cash rate (OCR) unchanged at 1.75 percent.
- The RBNZ statement has a more dovish bias with the central bank also hinting readiness to act if conditions sway from its expected path.
- Technical indicators are bearish. Momentum with the bears and -ve DMI dominance adds support to downside.
- Price has broken below 61.8% Fib and we see scope for test of 78.6% Fib at 72.3 levels.
- Bearish invalidation likely if the pair manages to retrace break below 74.80 (trendline). Close above could see some pull back.
Support levels - 74, 72.37 (78.6% Fib)
Resistance levels - 74.80 (trendline), 75.29 (5-DMA)
Recommendation: Good to go short on upticks around 74.60/70, SL: 75, TP: 74/ 73/ 72.40
FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at -147.707 (Bearish), while Hourly JPY Spot Index was at 11.6185 (Neutral) at 0800 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
