FxWirePro: NZD/JPY bounces off 20-DMA support, good to go long on breakout at 81.15

• NZD/JPY takes 20-DMA support and bounces higher on Wednesday's trade.
   
• The pair closed above 5-DMA and indicators on daily charts are turning bullish.
   
• Upside finds stiff resistance at major trendline resistance at 81.15, further upside likely on breakout.
   
• Kiwi lacked strong conviction and mixed Chinese data fails to lend additional support.
   
• A slightly better-than-expected Chinese fourth-quarter GDP print was largely offset by a big miss on retail sales data.
   
• On the other side, BoJ officials believe the ultra-easy monetary policy is needed for now and are of the opinion that the markets have run ahead of themselves.
   
• Friday's release of New Zealand Business Manufacturing Index will be watched for further impetus.
   
• Bearish divergence on intraday charts keeps scope for downside in the pair.
   
• We see scope for weakness on break below 20-DMA support at 80.28. Test of 200-DMA at 79.51 then likely.

Support levels - 80.69 (5-DMA), 80.28 (20-DMA), 79.51 (200-DMA), 79, 78.08 (61.8% Fib retrace of 76.09 to 81.31 rally)

Resistance levels - 81.15 (trendline), 81.31 (Jan 9 high), 81.65 (Sept 28 high), 82

Recommendation: Good to go long on break above 81.15, SL: 80.60, TP: 81.65/ 82

FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at 78.0958 (Bullish), while Hourly JPY Spot Index was at -104.95 (Bearish) at 0830 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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