FxWirePro: NZD/JPY struggles to hold break below 78 handle, bias bearish

• NZD/JPY is retraced dip below 78 handle, is currently trading around 78.21 levels.
   
• The pair has edged higher from multi-week lows at 77.93, bias still bearish.
   
• Break of 'Wedge Base' support at 78.90 keeps scope for downside.
   
• The pair now finds strong support at weekly 100-SMA at 77.77, break below will accentuate weakness.
   
• Kiwi continues to remain under pressure, is likely to extend weakness in the wake of the electoral results.
   
• Further, disappointing NZ trade balance data, which showed that the trade deficit widened more-than-expected weighs on the kiwi.
   
• Technical studies are bearish and we see scope for test of weekly cloud base at 76.52.
   
• On the flipside, we see major resistance at 79.90 (nearly converged 200 & 50-DMA). Bearish invalidation on break above.

Support levels - 78, 77.77 (weekly 100-SMA), 77, 76.52 (weekly cloud base)

Resistance levels - 78.60 (5-DMA), 79, 79.93 (200-DMA)

Call update: Our previous call (http://www.econotimes.com/FxWirePro-NZD-JPY-breaks-Wedge-Base-support-at-7890-bias-lower-stay-short-969077) has hit TP1/2.

Recommendation: Book partial profits at lows. Trail stop loss to 79, hold for further downside.

FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at -46.7293 (Neutral), while Hourly JPY Spot Index was at -64.1724 (Neutral) at 0840 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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