- NZD/JPY is trading 0.34% lower on the day, extends weakness for 2nd straight session.
- Price action was capped at 55-EMA resistance at 78.62 on Tuesday's trade.
- The Kiwi has been struggling to get support on the back of New Zealand GDP miss.
- New Zealand's GDP y/y stood at 2.9%, below the expected 3.1%, but still above the 2.7% posted for the previous year.
- Price has dipped below 5-DMA support at 77.80, close below could see further weakness.
- Scope then for test of major trendline support at 76 levels. Violation at 76 (trendline) could see major weakness.
- On the flipside, breakout above 55-DMA could see next major resistance at daily cloud. Breakout above daily cloud invalidates bearish bias.
Support levels - 77.35 (Oct 31 low), 76.93 (Dec 7 low), 76 (trendline)
Resistance levels - 77.76 (5-DMA), 78, 78.55 (55-EMA), 78.95 (cloud base)
Recommendation: Watch out for close below 5-DMA to go short. Place stops at 78.55, target 77.35/ 77/ 76.
FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at 15.9824 (Neutral), while Hourly JPY Spot Index was at 124.89 (Bullish) at 0930 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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