Hi Traders! Today I am sharing with you the NZDJPY technical analysis and forecast post. We do our analysis on the MetaTrader4 platform (MT4), some very interesting, useful tips and hacks about the MT4 platform could be found here. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Now, let’s start our analysis from the highest timeframe which will be the daily chart here.
You can watch the video explanation of this idea here
NZDJPY D1(Daily) Chart Analysis – Strong Resistance Zone, Bearish Divergence, Volumes Indicator, Parabolic Sar
On the daily chart the price which is moving higher has reached a strong resistance zone where the psychological round number 80 coincides. The price respected this zone and is currently bouncing lower from this zone. We also have a bearish divergence that has formed between the first high that has formed at 79.421 and the second high that has formed at 80.179 which we may consider as evidence of bearish pressure. In addition to this, based on the Volumes indicator we could see that the volumes are dropping, we may consider this as another evidence of bearish pressure. Also, based on the Parabolic Sar we could see that the dots are above the price which we may consider as yet another evidence of bearish pressure. We may now move down to lower timeframe and look for evidences supporting this bearish view.
NZDJPY H4(4 Hours) Chart Analysis – Bearish Trend Pattern, ADX Indicator, Key Resistance Zone
On the H4 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. In addition to this, the ADX indicator gave a bearish signal here at the cross of -DI (red line) versus +DI (green line) and the main signal line (silver line) reads value over 25 which we may consider as yet another evidence of bearish pressure. While measuring this bearish trend pattern using the Fibonacci retracement tool we have a key resistance zone that has formed based on the 38.2%(79.148) – 50%(79.345) Fibonacci retracement zones. Until this key resistance zone holds my view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
NZDJPY D1(Daily) Chart Analysis
- Strong Resistance Zone, Bearish Divergence, Volumes Indicator, Parabolic Sar
NZDJPY H4(4 Hours) Chart Analysis
- Bearish Trend Pattern, ADX Indicator, Key Resistance Zone
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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To your success,
Vladimir Ribakov
Certified Financial Technician
