NZD/JPY: Bearish Breakdown from Ascending ChannelNZD/JPY has decisively broken below its ascending channel, signaling a shift from bullish structure to bearish momentum. This move aligns with fundamental headwinds for NZD and the potential for JPY strength amid intervention risks and global risk-off sentiment.
Technical Analysis (4H Chart)
Pattern: Breakout from ascending channel support confirms a bearish reversal.
Current Level: 87.12, trading below the broken trendline with strong selling pressure.
Key Support Levels:
86.00 – first bearish target and immediate support zone.
84.60 – extended bearish target if momentum continues.
Resistance Levels:
88.04 – previous support turned resistance.
89.06 – upper boundary and invalidation zone for bearish bias.
Projection: Price is expected to retest 86.00, and if broken, further decline toward 84.60 is likely.
Fundamental Analysis
Bias: Bearish.
Key Fundamentals:
NZD: Pressured by global tariffs and risk-off sentiment.
JPY: Supported by potential FX intervention from Japan’s Ministry of Finance and safe-haven demand.
US Data Impact: Weak NFP boosted Fed cut bets, but risk-off flows strengthen JPY against risk currencies like NZD.
Risks:
China stimulus or a risk-on shift could lift NZD.
Lack of BOJ action may weaken JPY temporarily.
Key Events:
RBNZ policy outlook.
BOJ comments or intervention signals.
US CPI influencing global risk sentiment.
Leader/Lagger Dynamics
NZD/JPY is a lagger, reacting to risk sentiment and JPY moves, with JPY strength leading the pair lower.
Summary: Bias and Watchpoints
NZD/JPY is bearish, with a clear technical break from its ascending channel. The pair targets 86.00 initially and 84.60 on extended downside. Key watchpoints include BOJ FX policy, RBNZ stance, and global risk sentiment, especially if markets move deeper into risk-off mode.
