There may be a potential sell opportunity forming on the NZD/JPY.
The current weakness in Kiwi versus Yen (NZD/JPY) was initiated by a dovish shift in the RBNZ’s (Reserve Bank of New Zealand) monetary policy statement and forward guidance in interest rates , which surprised investors and sent the Antipodean currencies tumbling lower on the likelihood of future OCR (rate) cuts in the New Zealand Dollar. The slide lower in NZD/JPY encountered an area of support around the 74.80 zone, where the asset became oversold and was prepared to retrace some of its earlier losses on short covering activity. We are expecting the NZD/JPY to continue to expand lower after a period of correction / consolidation, so we need to look for an opportunity to sell / short the pair on bearish confirmation.
On the 4 hour chart of NZD/JPY, we have a zone of 4 hour structure resistance (75.90/76.10), that can serve as a potential reversal zone if price continues to correct higher.
NZD/JPY shorting opportunity at Supply Zone. March 29, 2019.
Both of the moving averages (20-period, 100-period) are sloping lower, which indicates more downside for the Kiwi. Therefore, if price corrects higher into the 75.90/76.10 price zone, look for a chance to enter a sell order on NZD/JPY upon bearish confirmation.
A potential target may be within the 75.00 price level or zone.
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