FxWirePro: NZD/JPY capped below 5-DMA, momentum bearish, eyes 78.6% Fib at 77.26

• NZD/JPY remains capped below 5-DMA at 78.20, momentum studies are bearish.
   
• The major ran into fresh offers as data released earlier today showed a dismal New Zealand trade balance.
   
• Statistics New Zealand reported a trade deficit of NZD 566 million, wider than the NZD 227 million deficit in January last year and the largest for the month since 2007.
   
• The pair is extending weakness after break below daily cloud, scope for further weakness.
   
• NZD/JPY is down 0.24% on the day and is currently hovering around 77.86 levels.
   
• Technical studies are biased lower. We see scope for test of 78.6% Fib at 77.77. Violation there could see further weakness.

Support levels - 77.64 (Feb 14, 23 low), 77.35 (Oct 31 low), 77.26 (78.6% Fib), 76.30 (channel base)

Resistance levels - 78.20 (5-DMA), 78.70 (cloud base), 78.97 (20-DMA)

Call update: Our previous call (https://www.econotimes.com/FxWirePro-NZD-JPY-extends-break-below-daily-cloud-on-track-to-test-786-Fib-at-7726-stay-short-1168197) is progressing well.

Recommendation: Bias lower, stay short.

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