- NZD/JPY failed to break above stiff trendline resistance at 81.65, slips lower.
- Kiwi falls sharply against major peers as CPI data misses expectations. NZ Q4 CPI +0.1 pct q/q (poll +0.4 pct); y/y CPI +1.6 pct ( poll +1.9 pct).
- Bearish divergence on intraday charts keeps scope for downside in the pair.
- We see a decisive break below 20-DMA on Wednesday's trade. Recovery attemps on the day lack follow through.
- Upside was capped below 5-DMA. The pair hit session highs at 80.59 before paring gains to currently hover around 80.21 levels.
- The pair has slipped below 23.6% Fib retrace, we now see scope for test of 200-DMA at 79.62.
Support levels - 79.62 (200-DMA), 79.47 (38.2% Fib retrace of 76.09 to 81.56 rally), 79.32 (100-DMA)
Resistance levels - 80.27 (23.6% Fib), 80.52 (20-DMA), 80.65 (5-DMA)
Recommendation: Good to go short on rallies around 80.20/30, SL: 80.60, TP: 79.65/ 79.50/ 79.30.
FxWirePro Currency Strength Index: FxWirePro's Hourly NZD Spot Index was at -128.984 (Bearish), while Hourly JPY Spot Index was at 38.0362 (Neutral) at 0925 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest.
