NZDJPY has retraced about 60% of the December-January downleg from 82.85 to 73.63. The pair found resistance at the 61.8% Fibonacci retracement level at around 79.30 two days ago and is making another advance towards the level today. Near term indicators are bullish with RSI rising above 50 and the stochastics just above overbought level.
The medium-term outlook remains bearish though as prices remain below the Ichimoku cloud and the moving averages. The 50-day moving average is the next resistance level within scope at around 79.70. Prices would need to break above this level and into the cloud to shift the outlook to a neutral one.
If prices reverse downwards, support is likely to come at the 38.2% Fibonacci retracement level at 77.10. A drop below this level would increase the bearish bias in the medium term.
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