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NZD/JPY: waves good bye to 76 handle on NZ CPI

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 19, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Guatemala) - NZD/JPY has felt more downside, despite the minor recovery it had staged earlier in the week prior to the New Zealand CPI data that has just rocked up early Asia.

    New Zealand was a big mover today in that the RBNZ has been constantly missing their inflation target and this reveals the problems that the Central Bank will continue to face of they do not act on the OCR sooner than later. CPI came as -0.5% vs -0.2% expected Q/Q Q4 vs 0.3% previous. That miss coupled with 0.1% y/e for the same quarter vs 0.4% expected and prior.

    Meanwhile, the Yen has been on the back foot somewhat after a return of risk appetite in the markets as investors started to digest the Chinese crisis as the new norm and instead started looking for a return on idle capital.

    NZD/JPY technically

    NZD/JPY is technically in a consolidation of the fierce downtrend of since the start of the year form above 81.60. The cross as lost territory in a one way street down to 74.60 earlier in the year. On the 4hr chart, RSI is in neutral territory and leaves the downside wide open still for a test of the bearing gap at the start of the week guarding the 2016 aforementioned lows. S1 is at 74.89.
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