- Kiwi fades upbeat NZ PPI data led gains, moderate risk-aversion keeps JPY bid weighing on NZD/JPY.
- Also, China new home prices which came in at slowest since August 2016, failed to impress markets.
- Negative Asian stocks and oil prices, in the wake of Barcelona ‘terror attack’ induced risk-off, continue to dampen the sentiment around the higher-yielding assets such as the Kiwi.
- NZD/JPY trades a narrow range, hovers around 100-DMA support at 79.60. Break below could see further weakness.
- We note a 'Bullish Cypher' pattern which keeps scope for upside.
- Technical studies have turned neutral, weekly 20-DMA is strong support at 79.67, we see bullish invalidation on close below.
Support levels - 79.69 (100-DMA), 79.67 (weekly 20-SMA), 78.52 (38.2% Fib retrace of 83.809 to 75.626 fall)
Resistance levels - 80.00 (5-DMA), 80.08 (200-DMA), 80.60 (Aug 15 high), 80.92 (38.2% Fib retrace of 83.910 to 79.081 fall), 81
FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at 0.692962 (Neutral), while Hourly JPY Spot Index was at 109.111 (Bullish) at 0440 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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