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NZD/JPY: Review & Forecast

Published on: 20/01/2017

Since November the rates of the NZD/JPY have been in the frames of the uptrend, but the support line has moved significantly down. The uptrend is losing momentum and we can see the formation of a flat trend. During the last month the rates have been very stable and volatility remains at low levels, although recently in November the volatility was high, which is normal for all trading instruments with the yen.

NZD/JPY, H4 chart
The Japanese yen (JPY) has greatly weakened due to the promised policy of Donald Trump and his statements regarding Japanese car manufacturers (he intends to increase taxes for them, which could adversely affect imports from Japan, which exports to the U.S. a significant volume of its production). At the same time in the Japanese economy there is a recession with worrying preconditions of decreasing the volume of exports and investment, which could endanger the yen. In particular, data obtained from the Ministry of Finance indicates the reduction of foreign assets in October and November by 1.9% and 1.4%, respectively.

The New Zealand dollar demonstrates an enviable stability and has greatly strengthened amid increases in the construction of residential properties and a reduction in the trade deficit of New Zealand. Now the New Zealand dollar costs around 82.25–82.37 JPY. The best decision here is to open trades on a price correction to the downside. The MACD oscillator confirms it. In short-term trading short deals can be most effective.

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