The NZD/JPY pair is on a downward spiral, with bearish technical indicators and dwindling volume fueling its relentless sell-off. The RSI is in oversold territory, suggesting a potential exhaustion of the current downtrend, while the MACD maintains its bearish alignment in line with the overall trend.
This sustained decline has seen the NZD/JPY lose over 10% of its value from recent highs, breaching key support levels along the way. The pair has dropped below the psychological level of 89.00 and remains well below the 200-day SMA, indicating a strong bearish sentiment in the market.
Yesterday, the NZD/JPY fell by 1.60% to 86.00, further reinforcing the dominance of sellers. However, it managed to avoid plunging to the critical support level of 83.00, suggesting a potential pause in the downtrend. The RSI hovering around 20 indicates oversold conditions, potentially hinting at a reversal in the near future.
NZD/JPY Daily Chart
As the pair hovers near the 86.00 support level, further support can be found at 85.50 and 85.00, offering potential areas for a temporary bounce. Resistance levels are at 89.00 and 90.00, with the latter coinciding with the 200-day SMA, presenting a significant hurdle for any bullish momentum.
Analysis:
The NZD/JPY pair is experiencing a significant downtrend, driven by bearish technical indicators and low trading volume. While the RSI suggests potential exhaustion of the current sell-off, the MACD remains bearish, aligning with the overall trend. Traders should watch for signs of a reversal as the pair approaches key support levels, with a break below 86.00 opening the door to further downside. Resistance at 90.00 poses a challenge for any potential bullish momentum, signaling a challenging road ahead for the NZD/JPY pair.