USDJPY is holding around the fresh 24-year high at 136.70, surpassing successfully the previous highs of 135.57 and endorsing the bullish view.
The MACD is moving further above its red signal line, and the RSI is pointing down after it reached the 70 level. However, the latter could also be an indication that the advance has been exaggerated, and as a result, bearish corrections in the upcoming sessions should not come as a surprise to investors.
In the event that the price moves in the opposite direction, the immediate support could come from the 135.57 barrier ahead of the 20-day simple moving average (SMA) around 132.35, which the bears were unable to break over the previous week. As the price moves lower, attention will shift to the support level at 131.35, though, a violation of the 40-day SMA located at 130.70 would boost speculation that the current bullish phase may transition into a neutral phase in the near future.
Traders will be avidly watching for a break above today's peak of 136.70 in the alternative scenario, which would result a rally towards the next psychological levels. If that turns out to be the case, the upswing can continue until the price reaches 140.00.
The recent bullish activity has made the wider picture more optimistic as well, and traders may expect additional improvement in the market as the shorter-term SMAs continue to increase their distance above the longer-term SMAs.
NZD/USD eyes June’s lows as bears regain control
NZDUSD resumed its slide on Wednesday, bringing the key 0.6335 – 0.6195 bottom area back under the spotlight after a four-day-long unsuccessful battle with the red Tenkan-sen line.
The RSI and the MACD remain negatively charged within the bearish zone, while the negative intersection between the red Tenkan-sen and blue Kijun-sen lines is another indication that the bears may hold onto control in the coming sessions.
Should the price close below 0.6235, the former resistance zone around 0.6160 may immediately attract some attention before selling pressures intensify towards the 0.6000 round-level. Below that, there is another important barrier around 0.5916.
Conversely, a decisive move above the red Tenkan-sen line currently at 0.6316 may continue towards the 20-day simple moving average (SMA) at 0.6400. If the 50-day SMA proves an easy obstacle too at 0.6452, the pair may visit the 0.6500 psychological mark, though only a durable rally above June’s topline of 0.6567 would make any rebound credible.
Summarizing, the odds are in favor of the bears in the NZDUSD market, and the next downside target is the May-June floor of 0.6235 – 0.6197.
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