NZD/JPY: potential longs
By Felipe Erazo
On the daily chart, the NZD/JPY is correcting its current trend from the level of 89.29, so now is facing the support offered by the Fibo level of 38.2 (86.70). This pair has been conducting an orderly, so it is expected that NZD/JPY continue forming bearish patterns, looking for a support to return to resume the bullish trend that had left at the level of 89.29.
It is likely that the decline of this pair will continue, at least until the 61.8 Fibo level at 84.71, which coincides with the 200 SMA. For the long term and swing traders, that would be a good area for put buy orders. However, a breakout on the resistance level of 87.93, could lead to the NZD/JPY up to the level of 89.29.
The CCI indicator is showing a bullish divergence, so it is very likely that the NZD/JPY can do a bullish rebound at current levels and to complete the retracement in the daily chart.
Trading recommendation: Place buy orders around 50.0 Fibo level (85.70) and 61.8 (84.71). The invalidation point of our bullish forecast is placed in the 83.29 level. If the pair touches that level, the NZD/JPY could continue falling.