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NZDJPY: Bullish Outlook Hinges on 77.30

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NZDJPY has been trending lower since July 2017. The lower highs and lower lows since the 2017 high at 83.90 tell the story.

But since late October, buyers have had their way.

The NZDJPY managed to claw back more than 500 pips since the quadruple bottom at 72.35.

There are actually two channels at work here.

One recently gave rise to the 500-pip rally I just above.

NZDJPY daily time frame

The pattern above extends from the year-to-date high at 81.56. Buyers cleared the level on November 1st and never looked back.

However, the rally has stalled in recent weeks. NZDJPY bulls have had to retreat since carving the November 15th high at 77.72.

And that brings us to the second channel.

The one below extends from the July 2017 high. Remember, that’s where the downtrend began 16 months ago.

Buyers encountered selling pressure on November 15th because of channel resistance.

That said, they’ve held their ground relatively well. The recent resilience from bulls could be indicative of a second breakout.

At the same time, as long as channel resistance near 77.30 is intact on a daily closing basis, NZDJPY is vulnerable.

Keep in mind that I use New York close charts, so a “daily closing basis” refers to the 5 pm EST close.

I’ll be the first to admit that horizontal levels are hard to come by, at least ones that stand out.

The only exception to that might be 79.30. You can see how this area has served as a pivot since February 2016.

Beyond that, we have 81.30 followed by the multi-year high up near 83.70.

For now, though, NZDJPY buyers have their work cut out for them. Until they can clear resistance near 77.30, there isn’t much to do here in my opinion.

My only reason to lean toward a bullish outlook is the fact that NZDJPY is coming off the bottom of a 1,150-pip range that has been in place since 2015.

A close above channel resistance could trigger the next leg of this rebound. Alternatively, a rejection from 77.30 resistance would take price back to 75.50.

Note: The chart below shows the weekly time frame.

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NZDJPY weekly time frame

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20 comments
Muzzemmil says

What do you think justin will it ahort from here or continue trend?

Reply
    Justin Bennett says

    I don’t try to guess in situations like this. I sit back and wait for the market to make the first move.

    Reply
Jacob says

Very good analysis; good job Justin.

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Anesu says

Thanks Justin. Informative as always

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    Tawanda says

    Ndeip Mudara, Regai tirove ma pips

    Reply
Vuyo says

My sentiment is that it’ll go higher, only time will tell. Good part is that it moves very fast. Let them rain pips!

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Seyi says

I tend to agree that if 77.30 is taken out on a daily closing basis, then a possible retest should take it to the next level.

That was the rejection point last week and a retest next day, took it down by 100 pips.

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Mimi says

My own analysis points to a side-way/consolidation move for the rest of this month as the pair reached a monthly pivot area, but will wait and see what the market does.

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Hernando says

Good afternoon Justin, I’ve been watching the pair in TF 4H and I see that the resistance of the channel is offering a strong opposition, if at the close of the day (5PM NJ) it is rejected again it would be good to wait for a bearish configuration in 4H to go to search initially the support of the same channel in the 76 Approx, if it breaks the resistance everything would be annulled low and we would enter to look for bullish configurations. What is your opinion of this analysis? See you and thank you for your support.

Reply
    Justin Bennett says

    My opinion is stated in the post above. 🙂

    Reply
MUSHTAQ HUSSAIN says

Good technical analysis

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Celestine says

sir. your analysis is 100% intellectual and lovable. please keep it up.

Reply
    Justin Bennett says

    Thanks for the kind words.

    Reply
moffat says

great………….your analysis have helped me a lot God bless

Reply
    Justin Bennett says

    Glad to hear that. Cheers.

    Reply
Uzoma Nnamdi says

It printed a head and shoulder on H4 but it closed back above the neckline. Thanks for the analysis sir

Reply
    Justin Bennett says

    That’s why I don’t trade the head and shoulders on anything lower than the daily.

    Reply
Hi jutin.. i really do like your analyses will also want to join the membership area but your price i mean the exchange rate here in nigeria is high at least for a gradute with no job yet.pls can you do more on ur discount says

Hi jutin.. i really do like your analyses will also want to join the membership area but your price i mean the exchange rate here in nigeria is high at least for a gradute with no job yet.pls can you do more on ur discount

Reply
    Justin Bennett says

    Glad you like the analysis.

    As for the price, it won’t ever be lower than $297 USD. That’s already incredibly low given the time it takes me to maintain the member’s area.

    Reply
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