The pull back in market sentiment pushed the Japanese yen higher against its major currency counterparts this week, and the low-yielding currency may continue to push higher over the following week as investors curb their appetite for ‘risky’ assets.
[B]Currency Pair:[/B] NZD/JPY
[B]Chart:[/B] 60 Min Charts
[B]Short-Term Bias:[/B] Flat
[B][U]Analysis[/U][/B]
The pull back in market sentiment pushed the Japanese yen higher against its major currency counterparts this week, and the low-yielding currency may continue to push higher over the following week as investors curb their appetite for ‘risky’ assets. After reaching a high of 65.32 in October, the NZD/JPY slipped to a low of 44.23 in February, and the lack of momentum to push back above 60.80-90 (78.6% Fib) paired with expectations for a 50bp rate cut by the Reserve Bank of New Zealand is likely to weigh on the exchange rate over the remainder of the month. Over the next few hours of trading, we may see the kiwi-yen push higher to fill-in the gap from the 120 SMA as the RSI remains in oversold territory however, as the economic calendar is expected to reinforce a weakening outlook for growth and inflation, fundamental headwinds are likely weigh on the markets, which should lead the pair towards the lower bound of its range over the near-term. In the following week, if we see the pair make a run for 54.70-80 (50.0% Fib), a break below this level could lead the NZD/JPY to retrace the rally in March, and work its way towards 52.20-30 (38.2% Fib) to test for short-term support. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.
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