NZD/JPY traded higher yesterday, after hitting support at 83.35, a zone which acted as a key support in the past as well, between April 26th and May 6th. Overall, the pair continues to print higher highs and higher lows above the upside support line drawn from the low of May 12th, and thus, we will consider the short-term picture to be positive.
We believe that the bulls are likely to stay in charge and perhaps soon challenge the 84.85 barrier, near the peak of May 4th. If they don’t stop there, we could see them pushing for the high of April 28th, at around 85.40, the break of which could carry larger extensions, perhaps towards the 86.60 territory, marked by the inside swing lows of April 20th and 21st.
Shifting attention to short-term oscillators, we see that the RSI broke above 70 and keeps pointing up, while the MACD lies above both its zero and trigger lines. Both indicators detect strong upside speed and support the notion for further advances in this exchange rate.
Now, in order to turn our gaze to the downside, we would like to see a clear dip below 82.80, a territory which provided resistance between May 23rd and 26th. This could also confirm the break below the aforementioned upside line and could allow declines towards the low of May 24th, at around 81.30. If the bears are not willing to stop there, then we may see them extending their dive towards the low of May 19th, at around 80.50.
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