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NZD/JPY Completes Price Bottom at Key Support

NZD/JPY rallied sharply in the past couple of weeks, accelerating in the recently days and completing a price bottom as we can see in the daily chart. 

NZD/JPY Daily Chart 10/7

(click to enlarge)

As we can see, price has broken above a triangle, as well as a key resistance pivot around 78.88. The daily chart also shows that the next key challenge will be around 80.50, where price will meet a previous support pivot area and a falling trendline. I would expect some resistance and anticipate a test of the completed price bottom.

Now, I would respect this price bottom because of a couple of reasons. 1) The Japanese Yen has been in a secular bear market, and its strength in recent months can be assessed as a correction. 2) NZD/JPY is at a key support, so the price bottom shows that bulls are back in control here.

NZD/JPY Weekly Chart 10/7


(click to enlarge)

We can see that price coming up from a key support around 74.40, going back to 2013. The 80.50 area was also a support/resistance pivot area back in 2013. Now, if price comes back down, I would look for the triangle to provide support, down to 76.00. Below that, we can say bulls have lost the battle to reverse the market. 

Now, let's say price holds above 77 after a subsequent pullback and we do believe in further upside above 80.50, the 84.00 handle looks like a good place to limit the bullish outlook first, with the more aggressive outlook in the 86-87.00 support/resistance area.