By Forex Signs, Inc.
NZDJPY has formed a bearish trend after yesterday’s price went up to 62.599 but closed at 62.107. Price is consolidating between support level 62.011 and resistance level 62.308, with price testing the resistance level. Sell bias is possible in the nearest term. If price pushes up breaking the resistance level a bullish reversal may happen. If price makes a break below resistance the bearish trend may continue and validate the bias for this pair. RSI (14) shows price is within the neutral zone, suggesting the bearish trend may sustain its momentum.
Alligator Feeding on USDCHF’s Bearish Trend
Since the double top reversal pattern of USDCHF pair noted last week, the pair has been continuously striding down. At the opening of today’s session, the price level opened at 0.9580. The initial price is not the pair’s resistance level. Seven candle sticks after at H1 chart, the pair had a bearish breakout. The fall went further down as the following candle stick tries to create new support level at 0.9542. In the previous trade, an Elliot wave was perceived at H1 chart. Before the trade ended yesterday, the price level had a reversal which only reached 50 percent of wave iii using the Fibonacci retracement. Today, if Elliot wave will be followed, at the time of writing, the pair is at wave i. Chances are, the trend is still pursuing a bearish market. For three days now, the %R (14) is lingering at an oversold level. It tried to go away but only reached values between -60 and -50. The fluctuating increases are most likely to be corrections only. However, once the signal touches a little above -50, there is a slight chance of a bullish reversal. To further test the downward trend, the Alligator indicator strongly indicates a sell activity as the lips of the gator is placed under its teeth. The distances of each part are significant and there are no clues that the gator will sleep at any time today.
Recent Quake Weakens Kiwi
The Kiwi is possibly looking at a downward trend against US dollar as reports show that New Zealand is experiencing a slow economic growth. The stall in their economy is due to the lagging of their housing and manufacturing sector. The lagging began when the nation’s worst earthquake in eight decades occurred last September 4. The quake measured a magnitude 7 and it shook Christchurch city. It is only now that the aftermath is felt since as indicators for the third quarter were released.
Further, the sluggish growth adds to the case for central bank Governor Alan Bollard to keep interest rates unchanged to revitalize consumer confidence from a 17-month low and shore up housing demand. As a result, the Kiwi is being pushed further down. Economists say that New Zealand’s currency might show more weakness next year.
However, the NZD can possibly experience an increase if ever something market-moving happens to Australia and Japan. If something negative happens, traders will most likely consider NZD as Asia’s currency safe haven; similar with what happened to the Swissie.
In conclusion, the news scattered today indicates that the Kiwi is likely to depreciate. The recommendation is quite strong as economists are also stating likewise.
About the Author
Forex Signs, Inc., Founded in 2006 in Wall Street, New York City, FSI relentlessly strives to be the premier Forex brokerage company in the industry by providing exclusive and unmatched trading and investment related services while constantly developing innovative solutions that cater to the vast requirements of both individual and institutional market participants.
