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NZDJPY
NZD/JPY prints at ¥86.94, shy of the cycle high seen on 13 Dec at ¥88.17.
- The pair briefly traded through its 20-day EMA in early dealing today before finding support at ¥86.57 at the base of its bull channel that the pair has been in since 11 Oct.
- Despite the aforementioned report over the weekend of a possible revision of the BOJs inflation accord, which was subsequently denied by Cabinet Sec. Matsuno, rate divergence looks set to continue, at least in the near term.
- OIS markets are pricing ~70 bps of tightening into February's RBNZ meeting, with a terminal rate at ~5.55%. The BOJ on the other hand is expected to keep its Policy Balance Rate at -0.1% and 10-Yr Yield Target at 0.00% when they meet tomorrow (the MNI BOJ Preview will be available in the London Session today).
- NZD bulls will be targeting a break above the cycle high ¥88.17, opening up the bull channel resistance at ¥90.94. Bears will target a break through the bull support to test the 50-day EMA at ¥86.09.
Fig 1: NZD/JPY - Bullish Trend Remains Intact
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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