Up 1.89% on the day
The NZD — on risk no flows — is leading the way as the strongest of the major currencies. It is higher vs all the major currencies with the largest gain vs the JPY. The NZDJPY is up 1.89% on the day (was up close to 2% at the highs).
Looking at the hourly chart for the pair, the price action has seen it’s share of ups and downs. Just last Monday, the price was as high as 65.787. Then 4 of the 5 days last week, saw a decline with the price bottoming at 63.412. That was a decline of 237 pips or 3.6%.. The fall Friday and into the early hours today, saw the price low take out the May 7 low of 63.548. However, but selling could not be sustained and «risk on» flows started.
The NY session has seen the price move from a low of 63.948. The accelerated move was triggered initially by the Moderno vaccine news at the start of the day. The price action took the price of the pair through the 100 hour MA (currently at 64.228), the 200 hour MA at 64.57 and the 50% of the move down at 64.60.
The price high reached 64.87 and backed off to retest the 50%/200 hour MA. So far, that risk level has held support. Stay above, and the bulls remain in full control.
Taking a broader look at the daily chart, the up and down price action has been in play since March 24. The range has been from 63.007 to a high of 0.66158. The midpoint of that ranges is at 64.607. The high price today tested the 38.2% retracement of the broader move down from the December 2019 high to the March 2020 low. That level comes in at 64.84. The current price at around 6470 is between the midpoint level at 64.60 and the 38.2% retracement 64.84. The stay above 64.60 is more bullish. Getting above 64.84 increases the bullishness.
Admittedly, over the last 2 or so months, the price of the NZDJPY has been contained and traders really don’t know which way he wants to break. That’s the bad news. The good news is that at some point it will break, and the pair is likely to run.
In the short term stay above the 64.57 -64.60 and the upside is preferred. Move below and the waters get a little bit more muddy — at least the shorter term.
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