NZDJPY: A comprehensive Analysis. Will it reverse soon?
NZDJPY has been showing a lot of strength of late. After breaking through the all-important support of 72 during last July and plummeting to 66, NZDJPY has recovered all its losses. For the last 3 months, NZDJPY has been rallying consistently.
This has happened due to better risk appetite in the markets.
Looking at the sentiment, I can assume that a lot of retail traders are short on this pair. In fact, retailers have been selling this all throughout December.
So, is there any hope for the sellers?
Technically, NZDJPY has reached the 100 week EMA which can dampen the rally.
Secondly, it has also reached a descending Trendline Resistance, which has stopped the price on previous occasions.
And, most importantly, price is now at the Broken Support zone which can obviously work as a strong resistance now.
So, technically, there is a good chance for the sellers.
However, the market doesn't work as per colorful lines and patterns on our chart.
It works when the institution step in.
Based on price action, I can definitely say that the rally is overextended at this point.
We have also seen the presence of institutional sellers in the 72 area.
So, if I see price struggling here or a strong downward impulse, I will sell this market. Some kind of triggers such as bad economic data or risk-off events can push the price downward.
This has happened due to better risk appetite in the markets.
Looking at the sentiment, I can assume that a lot of retail traders are short on this pair. In fact, retailers have been selling this all throughout December.
So, is there any hope for the sellers?
Technically, NZDJPY has reached the 100 week EMA which can dampen the rally.
Secondly, it has also reached a descending Trendline Resistance, which has stopped the price on previous occasions.
And, most importantly, price is now at the Broken Support zone which can obviously work as a strong resistance now.
So, technically, there is a good chance for the sellers.
However, the market doesn't work as per colorful lines and patterns on our chart.
It works when the institution step in.
Based on price action, I can definitely say that the rally is overextended at this point.
We have also seen the presence of institutional sellers in the 72 area.
So, if I see price struggling here or a strong downward impulse, I will sell this market. Some kind of triggers such as bad economic data or risk-off events can push the price downward.
Trade closed: target reached:
Went exactly as I indicated in the chart. Above 600+ pips profit
