FxWirePro: NZD/JPY rejects resistance at 79.386, next strong support seen only at 75.786

From last three weeks, the pair has been rallying from the lows of 73.645 to 79.386, it is now observed that it is struggling to hold onto the crucial resistance at these levels.

As shown on the weekly charts, it has broken this level on weekly terms and that is where it has experienced the resistance slipping below 21DMA, you can observe the same on daily charts as well how the price behavior is bound to drop after approaching upper Bollinger band at this level in the recent historical evidences (see circled areas).

More importantly, as stated in our earlier posts the formation of doji pattern candle at 82.031 levels evidenced steep dips in recent weeks, for now it looks like bulls have again exhausted and given up.

The RSI oscillator on daily has begun diverging to the previous upswing rallies at around 60 levels which is near overbought territory. This would mean that selling pressures are piling up.

Subsequently, an attempt for %D crossover above 80's intensifies bears interests in the market, as a result we've seen today's lows at 78.326 to head travel towards south.

If it does not manage to hold onto the current level we could foresee near strong support only at 75.786 levels and even upto 74.478 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.