(Melina Deltas, CFTe – XM)
USDJPY found support at the 135.55 barrier, which holds near the medium-term ascending trend line but is still moving with weak momentum around the 20-day simple moving average (SMA).
Trend signals remain daunting as the price continues to trade near the Ichimoku lines, which proved to be a tough resistance area to overcome over the last couple of months. As regards the market momentum, some optimism seems to be building over an upside move as the RSI has paused its downtrend around the 50 level and the Stochastics have created a bullish crossover within its %K and %D lines.
In the event the bulls hold control, the 24-year high of 139.35 will come first into view. A violation at this point may see another challenging battle around the 140.00 psychological level. If buyers claim that zone this time, the 146.83 resistance, taken from the peak in June 1998, could immediately add some downside pressure.
Should the bears take the upper hand, driving the price below the uptrend line and the 135.55-134.25 support zone, the spotlight will shift to the 131.35 barrier, where any step lower will put the pair in a bearish mode in the medium-term picture. The long-term outlook will also face a deterioration if the decline extends below 125.10-126.30.
In brief, although USDJPY continues to face weak trend signals, the odds for an upturn seem to be growing, with the confirmation expected to come above the 24-year high.
NZDUSD rangebound after rebound stalls at 50-SMA
NZDUSD has been in a extended downtrend since March when it peaked at the 0.7032 region. Although the price has managed to regain some lost ground after its downfall ceased at the 26-month low of 0.6069, it is currently being held down by the congested region that includes its 50-day simple moving average (SMA) and the upper Bollinger band.
The short-term oscillators suggest that the positive momentum is waning. Specifically, the RSI has crossed below its 50-neutral threshold, while the stochastic oscillator is descending after being rejected at the 80-overbought area.
To the downside, bearish actions could send the price to test the June support of 0.6195. Further downside pressure may then open the door for the 26-month low of 0.6059. A violation of the latter could send the price to form fresh multi-year lows, where the May 2020 low of 0.5920 could be the next support region.
On the flip side, if buying interest intensifies, the recent peak of 0.6305, which overlaps with the 50-day SMA, could act as immediate resistance. Piercing through this region, the bulls could challenge 0.6398 before the spotlight turns to the June high of 0.6575. Higher, 0.6930 might prove to be a tough barrier for the price to overcome.
Overall, even though NZDUSD’s short-term picture has been improving, its recovery seems to be running out of steam. Therefore, a clear break above its 50-day SMA is needed to signal the resumption of the pair’s latest rebound.