Technical Analysis – NZDJPY buyers challenge 100-day SMA at upper band of Ichimoku cloud

Technical Analysis – NZDJPY buyers challenge 100-day SMA at upper band of Ichimoku cloud

Technical Analysis – NZDJPY buyers challenge 100-day SMA at upper band of Ichimoku cloud

Anthony Charalambous, XM Investment Research Desk

NZDJPY is attempting to climb above a key resistance area. The area consists of the 100-day simple moving average (SMA), the 69.67 resistance, the upper bound of the Ichimoku cloud and the 50.0% Fibonacci retracement of the down leg from 73.23 to 66.30.

The stochastics have risen into the overbought zone but the %K has yet to cross below the red %D line. The MACD has distanced itself into the positive region and above its red trigger line and the RSI is nearing the 70 level. In conjunction with the positive signals from the short-term oscillators, the upward sloping Tenkan-sen has completed a bullish crossover with the blue Kijun-sen, while the 20-day SMA is ready to climb above the 50-day SMA.

If the bulls manage to move above the challenging resistance region of 69.67 to 69.75, the 70.25 inside swing low from June 18 could provide some downside pressure. Moving higher, the 76.4% Fibo of 71.60 could draw attention before the 200-day SMA currently at 72.12.

To the downside, if selling interest picks up, reversing the price off the 69.67 resistance, the price could initially rest at the 38.2% Fibo of 68.95 and then around the 23.6% Fibo of 67.94, which is where the 20- and 50-day SMAs are currently located.

In brief, if the bulls manage to close above the 69.67 – 69.75 resistance region, the bias would turn neutral-to-positive, while a stronger rally above 70.25 is required to shift the medium-term picture to a neutral one.


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