NZD/JPY: Traders Wait to Find its Next Direction

• The pair has been choppy by obeying an Equidistant Channel on the H4 chart
• Simple Moving Average 30 has been working as a support
• The H1 chart made a good bullish move today
• Intraday price action has been bullish

NZD/JPY Trades within a Bearish Equidistant Channel  

The pair has been choppy recently on the H4 chart. The chart shows that the price gets trapped within a bearish equidistant channel. As of writing, the pair trades around the resistance of that channel. A bearish reversal pattern at the resistance may drive the price towards the channel’s support. However, simple moving average 30 has been working as support on the chart. Thus, the buyers may keep their eyes on the pair to go long above channel’s resistance. In case of a bullish breakout, the price may find its next resistance around 88.550.

Bullish Pennant on the H1 Chart

The H1 chart shows that the price made a strong bullish move upon finding its support around 85.770. It then made a bearish correction by obeying a bearish trend line before finding its horizontal support at 86.150. It is very evident that the chart trades within a bullish pennant. Intraday traders may keep their eyes on the breakout at the support and resistance of that pennant to make trading decisions. A bullish breakout at resistance may drive the price towards the North. The price may find its next resistance around 87.165. On the downside, if the price makes a bearish breakout at the pennant’s support, it may head towards the South. The level of 85.770 may hold the price as support in case of a bearish breakout.

The H4 and the H1 both charts look indecisive. Traders should patiently wait for the price to make a breakout and find its direction. The next breakout is going to provide lucrative risk-reward in either way. Thus, it is a pair to keep on traders’ watch list.

Written by: Md Tareq Sikder, Senior Analyst Forex Prop News

Contact and follow Tareq on Twitter: @tareqfpn